The exterior of Kluang Mall situated in Kluang, Johor.
KUALA LUMPUR: Sunway REIT Management Sdn Bhd has announced that RHB Trustees Bhd, the trustee of Sunway REIT, has entered a conditional sale and purchase agreement (SPA) with Tenaga Nusantara Sdn Bhd to acquire Kluang Mall in Kluang, Johor. The purchase consideration is RM158mil.
Kluang Mall caters to over 320,000 residents in the Kluang District and a potential market of around 1 million residents in Central Johor, encompassing regions like Batu Pahat, Ayer Hitam, Kulai and Mersing. The free-standing four-storey shopping complex has a gross floor area of approximately 808,000 sq ft and a net lettable area of 360,000 sq ft. 130 tenants make up the 99% occupancy rate.
The mall is income-generating and is envisaged to contribute positively to the future earnings and distribution per unit (DPU) of Sunway REIT as well as being yield accretive to Sunway REIT’s asset portfolio. It is expected to generate an indicative net property income (NPI) yield of approximately 6.8% based on the purchase consideration, in comparison to Sunway REIT’s portfolio NPI yield of 5.7% for the financial year ended December 31, 2023.
“We are pleased to be adding another asset to our growing portfolio and expanding our geographical footprint to central Johor. Kluang Mall has recorded strong and stable occupancy over the past years, supported by healthy growth in footfalls and a well-established presence in the area. Leveraging on Sunway’s strong branding and track record in retail management, we believe that the mall has the opportunity to be further enhanced through tenancy optimisation, proactive mall management and asset enhancement initiatives,” said chief executive officer (CEO) of Sunway REIT Clement Chen.
Chen expressed excitement to capitalise on the untapped potential within the central Johor area, which will soon benefit from the impending completion of the Gemas-JB Electrified Double Tracking rail project and ongoing road improvement work along the Batu Pahat-Ayer Hitam-Kluang federal route.
“The proposed acquisition of Kluang Mall is very much in line with Sunway REIT’s ESG goals. The mall won Gold for Non-Strata Retail 10 Years and Above category at The Edge Malaysia Best Managed and Sustainable Property Awards 2023, demonstrating its commitment to good property management and sustainability practices. This includes the use of energy-efficient lighting, investments in its chiller plants and deployment of state-of-the-art closed-circuit-television (CCTV) systems utilising artificial intelligence (AI) to deter crime within premises,” stated Chen.
“I am thankful for the team’s contribution shown over the years as Kluang Mall represents the culmination of years of their hard work and dedication, led by our shared values of leading in truth, competence and care. I am also deeply grateful for the support and trust placed in us by our tenants, stakeholders and the community. I am confident that the foundation we’ve built together will continue to thrive and grow under Sunway’s excellent stewardship,” said Tenaga Nusantara Sdn Bhd’s CEO and executive director Tey Fui Kien.
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