CapitaLand Buys Two Malaysian Malls For $527m

Source : The Straits Times, 17 Aug 2007

CAPITALAND has bought two Malaysian shopping centres for around $527.1 million, it announced yesterday.

The property giant, working through two of its subsidiaries, paid $336.8 million for Gurney Plaza in Penang and about $190.3 million for Selangor’s Mines Shopping Fair.

The malls will form the first two seed assets for the proposed CapitaLand-sponsored Malaysian retail real estate investment trust (Reit), CapitaLand said.

Gurney Plaza is a seven-storey mall strategically located on Penang’s Gurney Drive promenade. The mall is about five minutes’ drive from the city centre of Georgetown.

It has more than 700,000 sq ft in net lettable area and more than 300 specialty stores.

Mines Shopping Fair is a prime retail mall that is part of the Mines Resort City in Selangor. Opened in 1997, it has a unique Venetian-styled canal flowing through the mall.

The mall is located in the growth corridor in the south of Kuala Lumpur, and measures around 650,000 sq ft in net lettable area.

CapitaLand Retail’s chief executive, Mr Pua Seck Guan, said Mines Shopping Fair is a ‘quality asset’ that ‘enjoys a good flow of human traffic’ while Gurney Plaza ‘enjoys close to 100 per cent occupancy’.

‘The acquisitions provide CapitaLand with a unique opportunity to extend our retail real estate platform to Malaysia which, in addition to Singapore, China, India and Japan, will further strengthen our position as the leading retail property company in Asia,’ he said.

CapitaLand Group president and chief executive Liew Mun Leong said in a statement that the two acquisitions will help the company increase its Reit portfolio in Singapore and overseas.

‘In line with our current Reit strategy, we have identified other quality Malaysian retail assets that will augment Gurney Plaza and Mines Shopping Fair, and form the pipeline of assets for our pure-play Malaysian retail Reit, which could possibly be listed within a year,’ he added.

CapitaLand has sponsored five Reits. Four are listed on the Singapore Exchange and one on Bursa Malaysia.