REIT Focus: Sunway and Excel
Sunway REIT (MR:SREIT), Malaysia’s largest REIT in terms of asset size, market capitalisation, average daily turnover volume and free float, has set aside about RM300 million (₤64 million) in capital expenditures to be used for the total overhaul of the Yaohan mall, one of Kuala Lumpur’s oldest shopping centres. Sunway’s chief executive Datuk Jeffrey Ng told StarBiz in an interview that the extensive refurbishments could more than double rental rates, with the goal being to raise rents in the long term from RM5 to RM12 (₤1.07 to ₤2.57) per sq. ft.
The REIT was listed on the Main Market of Bursa Malaysia on 8th July 2010. Sunway has a portfolio of 12 retail, office and hotel properties worth RM5 billion (₤1.068 billion) and spread across Selangor, Kuala Lumpur, Perak and Penang.
At Sunway’s flagship Sunway Resort City complex located in Kuala Lumpur, several asset enhancement initiatives are under way. The REIT is building the Pinnacle, a Grade A office tower, which will expand the complex’s office population by 5,000 and add 1,000 car park bays. Also being developed is Sunway
Pyramid 3, which will offer 62,000 sq. ft. of retail space and a four-star hotel with 435 rooms. Sunway is spending about RM61.5 million (₤13.1 million) to improve the underground and above ground linkages between its offices, hotels, and mall within Sunway Resort City.
Starbiz quotes analysts as saying Sunway is poised to close its 13th acquisition before the year’s end, in line with the REIT’s track record of securing at least one new asset per year. “We have a huge appetite, but it has to be the right deal, with asset enhancement opportunities,” Ng said.
Sunway REIT’s share price climbed by almost 27 percent in one year, closing at RM1.560 on Tuesday, April 2.
Excel (NYSE:EXL), a shopping REIT based in California, said it delivered adjusted funds from operations of $8.5 million (₤5.6 million), or $0.20 (₤0.13) per diluted share in the fourth quarter of 2012. For the full year the REIT posted adjusted FFO of $28.6 million (₤18.9 million), or $0.78 (₤0.52) per diluted share, 5 percent higher than in 2011.
!m[Sunway Allocates Funds for Renovation and Expansion, Excel’s Assets Topped $1.1 Billion in 2012](/uploads/story/1777/thumbs/pic1_inline.png)
“2012 was transformational for Excel Trust in several respects. By acquiring $440 million [₤290 million] in quality properties, our asset base surpassed $1.1 billion [₤726 million] and our portfolio now exceeds 5.5 million square feet,” chief executive Gary Sabin said in a press release.
Excel went public on April 28, 2010 and has acquired about 32 properties since then. The company has gross leasable area of about 5.5 million, weighted average lease term of seven years and occupancy rate of 93 percent.
Excel’s board of directors has announced dividend of $0.17 per share for the first three months of 2013, higher than Q4 2012’s dividend of $0.1625 per share.
Shares in Excel added almost 11 percent in a year, closing at $13.69 on Monday, April 1.
**Sunway REIT’s share price was RM1.56 as of 14.30 GMT, 02.04.2013.**
**Excel REIT’s share price was $13.69 as of 14.30 GMT, 02.04.2013.**