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The Sun
10-06-2025
- Business
- The Sun
Paradigm REIT has three hotels and one commercial gateway on its acquisition radar
KUALA LUMPUR: Paradigm Real Estate Investment Trust (Paradigm REIT) has three hotels and a commercial gateway in its acquisition pipeline for the next three years. The assets are Hyatt Place Johor Bahru Paradigm Mall, Le Méridien Petaling Jaya, Premier Hotel Klang and Gateway@Kuala Lumpur International Airport (KLIA) Terminal 2. Paradigm REIT Management Sdn Bhd's investment, finance and accounts director, Chong Kian Fah, told reporters after the company's listing on the Main Market of Bursa Malaysia today that the proposed acquisition would be funded with a 50:50 combination of cash and newly issued REIT units. 'We plan to raise the cash portion through medium-term notes. Our proposal is to pay the vendor half in cash and half in new REIT units,' he said. The hotels, which are currently owned by Paradigm REIT's sponsor, WCT Holdings Bhd, are in the vicinity of its mall assets in the trust. Paradigm REIT is looking to do this as early as 2026 to inject the three hotels and then potentially 2027 or 2028 for the commercial gateway asset which the company is looking into besides eyeing other potential acquisition targets. Asked if there are any plans to acquire new malls following the listing, Paradigm REIT executive director and CEO Selena Chua Kah Noi said the company is open to it but it would depend on several key factors. 'We have to look at a few key things, including location, type of tenants, the mall surrounding, catchment and other factors,' she added. Chua said the company is looking to leverage on Visit Malaysia 2026 and is working closely with Tourism Malaysia on the programme. She said Paradigm Mall Johor will benefit the most out of the programme as many Singaporeans will be excited to come visit the country and spend their time shopping. 'Last year, we did a midnight sale in Johor Bahru which was very well received and the tourists from Singapore came in and shopped and we had a lot of activities lined up.' Paradigm REIT made a flat debut on Bursa Malaysia, opening at RM1 per share, unchanged from its initial public offering (IPO) price, on volume of 1.73 million units. It traded within a narrow range and closed at RM1, with 44.58 million shares traded. In May, Paradigm REIT's IPO garnered strong investor interest, with the public tranche oversubscribed by 1.49 times. The non-Bumiputera portion saw an oversubscription rate of 3.7 times. Paradigm REIT's IPO involved no issuance of new units, meaning the trust itself did not receive any proceeds. The entire RM560 million raised from the IPO went to WCT Holdings. Paradigm REIT chairman and independent non-executive director Tan Sri Shahril Ridza Ridzuan said the listing of Paradigm REIT marks a proud milestone for their team and for Malaysia's REIT landscape. 'While we opened flat at RM1, we view this as a stable and encouraging start – especially in a market where volatility has become the norm. 'The strong support from both institutional and retail investors affirms confidence in our portfolio and long-term strategy. We remain focused on delivering consistent value to our unit holders and executing our strategy in making our assets more value-accretive.' Paradigm REIT's current portfolio comprises three shopping centres – Paradigm Mall Petaling Jaya, Paradigm Mall Johor Bahru, and Bukit Tinggi Shopping Centre – collectively valued at RM2.4 billion and strategically located in high-traffic, high-growth urban areas. Managed by Paradigm REIT Management and sponsored by WCT Holdings, Paradigm REIT aims to maintain a disciplined acquisition strategy while leveraging on WCT Holdings' development expertise and network to unlock future growth opportunities. Paradigm REIT is expected to deliver an attractive distribution yield, backed by stable cash flows from its diversified and well-tenanted retail assets. It has committed to distributing at least 90% of its distributable income on a half-yearly basis.
New Straits Times
10-06-2025
- Business
- New Straits Times
Paradigm Reit eyeing three hotels, KLIA gateway
KUALA LUMPUR: Paradigm Real Estate Investment Trust (Paradigm Reit), a local real estate investment trust, plans to acquire three hotels and a commercial gateway over the next three years. The assets are the Hyatt Place Johor Bahru Paradigm Mall, Le Méridien Petaling Jaya, Premier Hotel Klang, and the Gateway@Kuala Lumpur International Airport (KLIA) Terminal 2. Paradigm Reit Management Sdn Bhd's Investment, Finance and Accounts director, Chong Kian Fah said the proposed acquisition would be funded through a 50:50 combination of cash and newly issued Reit units. "We plan to raise the cash portion through medium-term notes (MTNs). Our proposal is to pay the vendor half in cash and half in new Reit units," he said at a press conference following Paradigm Reit's listing ceremony today. Previously, it was reported that the unit trust aims to acquire the three hotels in 2026, and the commercial gateway in 2027 or 2028. The unit trust, which debuted on the Main Market today, opened unchanged from its initial public offering (IPO) price of RM1.00, with 1.73 million shares traded. Meanwhile, in terms of expansion, its executive director and chief executive officer, Chuah Kah Noi said that as the largest Reit presence in Johor Bahru, the team is also looking to acquire more assets in the state, focusing on those that are yield-accretive. She believes that Paradigm Reit is well-positioned to maintain a stable outlook, given the current sales and occupancy levels across its portfolio of assets. "For most shopping malls, what is critical is sales. The more sales you drive to your tenants, the more profitable they will be, and the more likely they are to stay. "Occupancy across our entire portfolio is quite strong. Our asset in Johor Bahru is about 99.3 per cent, in Petaling Jaya it is close to 98 per cent, and Bukit Tinggi Shopping Centre is fully leased at 100 per cent," she said. She added that Paradigm Mall in Johor Bahru as well as Paradigm Mall in Petaling Jaya are expected to continue performing well into next year, benefiting from the Visit Malaysia 2026 campaign and the close collaboration with the Ministry of Tourism, Arts and Culture Malaysia.
New Straits Times
16-05-2025
- Business
- New Straits Times
Main Market-bound Paradigm REIT aims to raise RM560mil from IPO next month
PETALING JAYA: Main Market-bound Paradigm Real Estate Investment Trust (Paradigm REIT) aims to raise RM560 million from its initial public offering (IPO). Paradigm REIT said in a statement today that upon listing, scheduled for June 10, 2025, it is expected to achieve an estimated market capitalisation of RM1.6 billion based on the illustrative issue price of RM1 per offer unit and a total listing of 1.6 billion units. "Paradigm REIT's IPO is poised to be the largest Malaysian REIT IPO in the past 13 years and one of the largest IPOs in Malaysia for 2025. "This shows the ability and depth of the Malaysian equity capital market to support large capital raises despite market volatility arising from the ongoing trade war," it said. It noted that the IPO provides opportunities for investors and unitholders to invest in a real estate investment that offers stable income distribution and potential capital appreciation on investment in the units, and allows Paradigm REIT to gain access to capital markets to raise funds for future real estate acquisitions. Meanwhile, Paradigm REIT Management Sdn Bhd director of investment, finance and accounts Chong Kian Fah said he is confident that the REIT could achieve its estimated market capitalisation amid market turbulence, classifying the REIT as a defensive stock. He said Paradigm REIT's IPO differs from the usual IPO and is more akin to a fixed income-type investment, coupled with the REIT's performance. "Currently, there are a few benchmarks that you can use to gauge whether the assets are competitive. First is the occupancy – whereby the occupancy of a mall, on average, is close to 99 per cent. "The second is our net property income (NPI) margin. So, for last year, our NPI margin was close to 64 per cent. And we are aiming to achieve 26 per cent this year," he told a press conference after the prospectus launch ceremony here today. Currently, Paradigm owns Bukit Tinggi Shopping Centre, Paradigm Mall Petaling Jaya, and Paradigm Mall Johor Bahru – three assets valued at RM2.4 billion. Based on the retail price of RM1 per unit, the projected annualised distribution yield for 2025 exceeds seven per cent. The IPO comprises a total offering of up to 560 million offer units, of which 254.7 million units are allocated for the retail offering and at least 305.3 million units are offered to institutional investors. "The retail offering comprises approximately 32 million offer units for application by the Malaysian public, of which 16 million units are reserved for bumiputera investors, 27.8 million units for eligible persons, and up to 194.86 million units for entitled shareholders of WCT Holdings Bhd on the basis of one unit for every eight existing shares held as at 5 pm on the entitlement date. WCT Holdings retains 65 per cent ownership in Paradigm REIT indirectly through its main shareholder. "Meanwhile, the institutional offering consists of 200 million offer units reserved for bumiputera investors approved by the Ministry of Investment, Trade and Industry, and the remaining 105.3 million offer units for other institutional and selected investors," it said. Paradigm REIT Management chief executive officer Chua Kah Noi said four assets – namely Hyatt Place Johor Bahru Paradigm Mall, Le Meridien Petaling Jaya, Premier Hotel Klang, as well as Gateway@Kuala Lumpur International Airport (KLIA) Terminal 2 – will be injected into Paradigm REIT. "I think we are looking as early as 2026 to inject the hotels – the three hotels – and then maybe 2027 or 2028 for Gateway@KLIA2," she said.
