KUALA LUMPUR (Sept 19): YTL Hospitality REIT (YTL REIT) has entered into three supplemental lease agreements for rental revisions and proposed refurbishment of its three hotels (AC Hotels) in Kuala Lumpur, Penang and Kuantan.

In a Bursa Malaysia filing on Tuesday, YTL REIT said the lessees of its AC hotel chain are agreeable to the increase in annual rental for all three hotels amounting to a collective RM2.7 million. On its part, the group has agreed to pay for the costs of the proposed refurbishment for all three hotels, at an estimated refurbishment cost of RM38.5 million, which would be funded by borrowings.

“The proposed rental revisions will allow YTL REIT to participate in the value creation of the proposed refurbishments through additional rentals which will increase the distributable income and distribution per unit (DPU) of YTL REIT.

“The proposed refurbishments will increase the market values of the AC Hotels and maintain their market positions while enhancing their growth potential,” it said.

YTL REIT added that the proposed refurbishment works at all the three hotel rooms will be conducted by Syarikat Pembinaan Yeoh Tiong Lay Sdn Bhd (SYTL).

YTL REIT boasts a total of 10 hotel properties in Malaysia which includes hotel chains such as JW Marriott Hotel Kuala Lumpur, The Majestic Hotel Kuala Lumpur and The Ritz Carlton Hotel Kuala Lumpur.

Shares in YTL REIT closed one sen or 0.99% higher to RM1.02, giving it a market capitalisation of RM1.74 billion.