Buying interest in Hektar REIT


PETALING JAYA: Hektar REIT attracted buying interest yesterday following the announcement that Singapore-listed Frasers Centrepoint Trust (FCT) would take a 27% stake in the real estate investment trust (REIT).

Its price shot up 12 sen, or 10%, to a record high of RM1.30, with 1.57 million units changing hands. This made Hektar the most actively traded REIT on Bursa Malaysia.

Industry players see the deal as a sign of rising foreign interest in the country’s property assets.

“The deal has led foreign dedicated property fund managers and investors to re-look at REITs in Malaysia, especially Hektar,” said AmInvestment Bank head of equity capital market Mejon Majambar.

Mejon said the placement being priced at a premium spoke volumes on Hektar’s prospects.

“Placements of shares or REIT units are usually done at a discount to market price,” he told StarBiz.

The block of 84.6 million units was placed out at RM1.21 per unit, against Tuesday’s closing price of RM1.18. AmInvestment Bank is the placement agent for the deal.

Mejon said the successful placement might pave the way for similar deals in the future.

“We have today (yesterday) received promising enquires from local property owners and foreign investors,” he added.

Mejon pointed out that Malaysia was getting back on the radar screen of foreign property fund managers after the recent changes in property regulations, such as the abolishment of real property gains tax.

“We believe the property sector will perform better and certain property asset classes will lead this wave of asset revaluation,” he noted.

Hektar is the first pure-play retail REIT in the country. It owns two shopping malls: Subang Parade in Selangor and Mahkota Parade in Malacca.

FCT, launched in July 2006, is a pure-play retail REIT under Frasers Centrepoint Asset Management Ltd, a real estate asset and fund management division of Frasers Centrepoint Ltd. Currently, FCT has three suburban malls with a combined value of RM2.1bil as at September 2006. The trust has expertise in financial, property fund management and real estate asset management services.

Dealers said having a reputable foreign shareholder, FCT, augured well for Hektar as it raised the possibility of better assets being injected into the REIT.

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