Hektar REIT injects RM20 million to enhance Landmark Central

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File photo shows Wwetex Parade, one of the properties within Hektar REIT’s portfolio.

File photo shows Wwetex Parade, one of the properties within Hektar REIT’s portfolio.

KUALA LUMPUR: Hektar Real Estate Investment (Hektar REIT) will inject RM20 million this year to enhance Landmark Central in Kulim, Kedah, as part of its strategy to increase the overall net lettable area (NLA) of malls within its portfolio.

Hektar REIT focuses on the management of retail shopping centres and currently its net lettable area stood at 1.8 million square feet.

Hektar Asset Management Sdn Bhd Chairman and Chief Executive Officer Datuk Jaafar Abdul Hamid said the asset management initiative would eventually increase the NLA of the shopping mall by approximately 20,000 square feet.

This would offer additional footprint for retailers who want to be part of Landmark Central’s growing number of tenants, he told reporters after the company’s annual general meeting yesterday.

“The enhancement of Landmark Central is slated for completion by the second quarter of 2017.

“Since its acquisition in 2012, Landmark Central emerged as the most promising among Hektar REIT’s five malls in terms of upward rental trajectory,” he added.

Hektar REIT’s portfolio of shopping malls included Subang Parade in Subang Jaya, Mahkota Parade in Melaka, Wetex Parade in Johor, Central Square in Kedah and Landmark Central in Kedah.

Jaafar said with its other major tenants such as Giant Superstore, The Store, MBO Cinemas and Ole Ole Superbowl, Landmark Central would be able to capitalise on its unique selling proposition as an all encompassing neighbourhood mall.

As at Dec 31, 2015, Landmark recorded a growth of 2.4 per cent in its occupancy rate, resulting in a high figure of 99.3 per cent against 96.9 in 2012.

Jaafar also said the group has embarked on a refurbishment initiative and other value creation strategies for its portfolio which would subsequently enhance the financial performance of all its malls.

The group was also eyeing to refurbish Subang Parade, however, he did not disclose the time frame.

Subang Parade contributed between 40 and 50 per cent to the group’s earnings, followed by Mahkota Parade.

As at Dec 31, 2015, the portfolio, valued at RM1.09 billion, had an average occupancy of 96.6 per cent and recorded over 30.6 million shopper visits.

He also said Hektar REIT would continue to look at internal strategies within each mall to identify value creation opportunities, as well as, be on the lookout for potential acquisition opportunities.

For the financial year 2015, Hektar REIT recorded a gross revenue of RM126 million and a net property income of RM76.5 million. — Bernama