KUP REIT unitholders approve RM118 million acquisitions, private placement
The newly approved assets – KIPMall Desa Coalfields, Lotus's Indera Mahkota, and two commercial buildings within an integrated development in Kuantan – are projected to generate RM11.3 million in revenue and RM8.0 million in net property income (NPI) in their first full year of operations.
This equates to 11.7% and 11.6% of KIP REIT's nine-month FY2025 revenue (RM96.2 million) and NPI (RM68.8 million), respectively, underscoring the earnings accretive nature of the expansion.
These assets are expected to deliver an average initial yield of 6.8%, supported by long-term, stable lease structures.
KIP REIT CEO Valerie Ong expressed appreciation for the strong backing from unitholders, noting that the acquisitions align with the REIT's strategy to strengthen its income-generating portfolio and support sustainable distribution per unit growth.
'The new assets will provide meaningful recurring income while expanding our footprint in high-potential suburban and emerging growth areas like Selangor and Kuantan. We are also encouraged by early investor interest in the private placement. With disciplined capital management and a proactive asset strategy, we are confident in delivering sustainable long-term returns,' she said.
KIPMall Desa Coalfields features a well-diversified tenant mix, while Lotus's Indera Mahkota is anchored by a 15-year master lease agreement with built-in rental escalations.
The two commercial buildings include shop lots and a KFC outlet, both secured by multi-year leases with renewal options, providing recurring income from established brands.
To fund part of the acquisitions and upcoming upgrades, KIP REIT will undertake a private placement of up to 160 million new units, targeting gross proceeds of about RM132 million.
The book-building phase is underway, with price-fixing scheduled for mid-August.
Of the total proceeds, RM106.6 million will be used for the partial settlement of the acquisitions, RM21.9 million will be allocated for asset enhancement initiatives (AEI) at KIPMall Tampoi, and RM3.9 million will be allocated for estimated expenses.
The AEI at KIPMall Tampoi forms part of the group's ongoing asset optimisation strategy, aimed at improving tenant mix, shopper experience, and rental yields. Planned upgrades include façade enhancements, interior refurbishments, and enhanced amenities to attract higher footfall and quality tenants.
Completion and allotment of the new placement units are expected by early September 2025.
This latest round of acquisitions and capital raising marks a significant milestone in KIP REIT's growth roadmap. Upon full completion – including pending acquisitions – the group's total portfolio value is projected to reach approximately RM1.6 billion, comprising over 3.4 million square feet of net lettable area.
The move also strengthens KIP REIT's geographical diversification, adding exposure to Pahang and reinforcing its presence along the East Coast, complementing its existing footprint in the Klang Valley, Johor and Perak.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Sun
2 days ago
- The Sun
‘Instant retail' price war in China shows no let-up
SHANGHAI: China's largest e-commerce platforms show no signs of halting an 'instant retail' price war that has proven unusually resilient to state criticism, underscoring the near-existential importance placed on instant retail as the future of e-commerce. Their fight in instant retail, where delivery can be as quick as half an hour, risks the wrath of authorities not averse to crackdowns and wary that aggressive price-cutting could entrench deflationary pressure in an economy already under fire from US tariffs and restrictions on tech exports to China. Alibaba, and Meituan have pledged almost 200 billion yuan (RM118 billion) combined to subsidise one-hour delivery in recent months, leading to customers who order beverages, for instance, effectively receiving them for free. So extreme is the strategy that the trio was summoned for the second time last week to the State Administration of Market Regulation which called for 'rational competition' aligned with the government agenda, said a person familiar with the matter. 'It's really a battle that takes place now but is much more related to the expectations for five to 10 years down the road. (The platforms believe this is) life or death, it might mean the future or the lack of a future for their company,' said Ed Sander, tech analyst at Tech Buzz China. The adoption of artificial intelligence and automated warehouses will make instant retail increasingly profitable to the extent it will cannibalise conventional e-commerce, he said. Examples of instant retail and attendant price war include coupons from Alibaba covering the cost of breakfast delivered within 60 minutes, or from Meituan offering free tea. JD Takeaway offers 10 yuan coupons for orders as little as 11 yuan. Alibaba, and Meituan did not respond to requests for comment. Authorities in China typically take a sustained and firm-handed approach toward practices they deem unfavourable to healthy and rational market development, making dissent rare. State media agency Xinhua was unequivocal in a Wednesday editorial about the negative impact of 'zero yuan purchases'. 'On the surface, platform companies engage in 'price wars' to compete for the instant retail market, but their essence is to use subsidies to give birth to a 'bubble market',' the editorial read. 'To put it bluntly, there is no winner.' China's US$19 trillion (RM80 trillion) economy grew 5.3% in the first half of 2025. Hinting at what may be to come, however, retail sales growth slowed to 4.8% in June from 6.4% in May. Moreover, ANZ economists estimated a 0.1% decline this year in the consumer price index and 3% decline in the producer price index, for what would be the first annual deflation since 2009. 'A price war is never in the interest of businesses. Consumers gain of course, but from a macroeconomic point of view (it leads) price expectations to keep decreasing,' said economics professor Bala Ramasamy at the China Europe International Business School in Shanghai. 'The level of competition we have in China has become unrealistic and at times toxic. Government intervention has become necessary for the sake of the greater good,' he said. The regulatory attention is different to that given to the electric vehicle sector, where price wars stemmed in part from overcapacity. One issued raised by the regulator at the Friday meeting was food waste from unconsumed zero-yuan orders, said the person familiar with the matter, who was not authorised to speak with media and so declined to be identified. 'Everything points in the direction that they (regulators) are not happy with this, definitely not happy with a lot of tech companies just burning money by handing out all of those consumer discounts that will have no long-term effect,' Sander said. The appeal of instant retail battle is difficult to ignore for e-commerce firms that have struggled to unlock growth in the consumer spending slowdown since the Covid-19 pandemic. The instant retail sector is growing around 2.5 times faster than conventional e-commerce and is set to surpass 2 trillion yuan in sales by 2030, showed data from the Chinese Academy of International Trade and Economic Cooperation. While consumers may enjoy the low prices, merchants complain on social media that price wars all but eliminate profit margins and restaurateurs bemoan a fall in profitable in-person custom. 'From a regulatory perspective, authorities are generally in favour of competition, what they oppose most is monopoly,' said catering industry analyst Wang Hongdong, founder of catering data research institute NCBD. 'So, a complete halt to the delivery war is unlikely (though) they are likely to address some current issues, such as the impact on dine-in restaurants.' – Reuters
Malay Mail
2 days ago
- Malay Mail
China's e-commerce giants lock horns in ‘instant retail' price war despite regulatory glare
BEIJING, July 25 — China's largest e-commerce platforms show no signs of halting an 'instant retail' price war unusual in its resilience to state criticism, indicating the almost existential importance placed on instant retail as the future of e-commerce. Their fight in instant retail, where delivery can be as quick as half an hour, risks the wrath of authorities not averse to crackdowns and wary that aggressive price-cutting could entrench deflationary pressure in an economy already under fire from US tariffs and restrictions on tech exports to China. Alibaba, and Meituan have pledged almost 200 billion yuan (RM118 billion) combined to subsidise one-hour delivery in recent months, leading to customers who order beverages, for instance, effectively receiving them for free. So extreme is the strategy that the trio was summoned for the second time last week to the State Administration of Market Regulation which called for 'rational competition' aligned with the government agenda, said a person familiar with the matter. 'It's really a battle that takes place now but is much more related to the expectations for five to 10 years down the road. (The platforms believe this is) life or death, it might mean the future or the lack of a future for their company,' said Ed Sander, tech analyst at Tech Buzz China. The adoption of artificial intelligence and automated warehouses will make instant retail increasingly profitable to the extent it will cannibalise conventional e-commerce, he said. Examples of instant retail and attendant price war include coupons from Alibaba covering the cost of breakfast delivered within 60 minutes, or from Meituan offering free tea. JD Takeaway offers 10 yuan coupons for orders as little as 11 yuan. Alibaba, and Meituan did not respond to requests for comment. Toxic competition Authorities in China typically take a sustained and firm-handed approach toward practices they deem unfavourable to healthy and rational market development, making dissent rare. State media agency Xinhua was unequivocal in a Wednesday editorial about the negative impact of 'zero yuan purchases'. 'On the surface, platform companies engage in 'price wars' to compete for the instant retail market, but their essence is to use subsidies to give birth to a 'bubble market',' the editorial read. 'To put it bluntly, there is no winner.' China's US$19 trillion economy grew 5.3 per cent in the first half of 2025. Hinting at what may be to come, however, retail sales growth slowed to 4.8 per cent in June from 6.4 per cent in May. Moreover, ANZ economists estimated a 0.1 per cent decline this year in the consumer price index and 3 per cent decline in the producer price index, for what would be the first annual deflation since 2009. 'A price war is never in the interest of businesses. Consumers gain of course, but from a macroeconomic point of view (it leads) price expectations to keep decreasing,' said economics professor Bala Ramasamy at the China Europe International Business School in Shanghai. 'The level of competition we have in China has become unrealistic and at times toxic. Government intervention has become necessary for the sake of the greater good,' he said. Instant appeal The regulatory attention is different to that given to the electric vehicle sector, where price wars stemmed in part from overcapacity. One issued raised by the regulator at the Friday meeting was food waste from unconsumed zero-yuan orders, said the person familiar with the matter, who was not authorised to speak with media and so declined to be identified. 'Everything points in the direction that they (regulators) are not happy with this, definitely not happy with a lot of tech companies just burning money by handing out all of those consumer discounts that will have no long-term effect,' Sander said. The appeal of instant retail battle is difficult to ignore for e-commerce firms that have struggled to unlock growth in the consumer spending slowdown since the Covid-19 pandemic. The instant retail sector is growing around 2.5 times faster than conventional e-commerce and is set to surpass 2 trillion yuan in sales by 2030, showed data from the Chinese Academy of International Trade and Economic Cooperation. While consumers may enjoy the low prices, merchants complain on social media that price wars all but eliminate profit margins and restaurateurs bemoan a fall in profitable in-person custom. 'From a regulatory perspective, authorities are generally in favour of competition, what they oppose most is monopoly,' said catering industry analyst Wang Hongdong, founder of catering data research institute NCBD. 'So, a complete halt to the delivery war is unlikely ... (though) they are likely to address some current issues, such as the impact on dine-in restaurants.' — Reuters
Malay Mail
3 days ago
- Malay Mail
Being thankful has multiplier effect — Hafiz Hassan
JULY 25 — I took A-Level Economics 40 years ago. A topic that has stayed with me since then is the 'multiplier effect'. What is the multiplier effect in economics? The multiplier is the number of times larger the change in income is, compared to the change in net injections that caused it. The multiplier effect states that an initial injection of spending or investment (usually by the government) leads to increased consumption spending and so results in an increase in national income greater than the initial amount of spending. For example, if the government spends a one-off cash aid of RM100 for all Malaysians aged 18 and above, to be used to purchase necessities from over 4,100 outlets including hypermarkets such as Mydin, Lotus, Econsave, and 99 Speedmart, the multiplier effect works by creating a cycle of spending and income. When the cash aid is spent, it creates income for others. The cycle continues as the income generated from the initial spending is spent and re-spent throughout the economy, leading to a larger increase in output than the initial spending alone. The cash aid is one of two main types of multipliers in economics—that is, government spending multipliers. Government spending multipliers refer to the impact of changes in government spending on overall output. The multiplier effect can be a key driver of economic growth, as it can lead to increases in overall output, employment, and incomes. The size of the multiplier effect depends on a variety of factors, and its impact on economic growth will vary depending on the specific circumstances. But I did not pursue economics at tertiary level and I am not an economist. My two-cent is that the cash aid comes with the multiplier effect. Being thankful has the multiplier effect as well. The Quran says: 'And remember when your Lord proclaimed, 'If you are grateful, I will certainly give you more. But if you are ungrateful, surely My punishment is severe.' (Surah Ibrahim, verse 7). **This is the personal opinion of the writer or publication and does not necessarily represent the views of Malay Mail.
