KUALA LUMPUR (May 13): Axis Real Estate Investment Trust (KL:AXREIT) is acquiring an industrial property in Shah Alam for RM38 million cash in a related-party transaction.

In a Bursa Malaysia filing on Wednesday, the REIT said trustee RHB Trustees Bhd had entered into a sale and purchase agreement with Rubicon Assets Sdn Bhd for the acquisition of the leasehold property.

The transaction is deemed a related-party transaction as Rubicon Assets director and major shareholder Stephen Tew Peng Hwee @ Teoh Peng Hwee is also the non-independent non-executive deputy chairman of Axis REIT Managers Bhd.

The property comprises a single-storey detached factory integrated with a double-storey office block and a four-storey factory/store block, with a net lettable area of about 120,177 sq ft.

Axis-REIT said the property is fully occupied by three tenants, namely OCK Telco Infra Sdn Bhd, Tamura Electronics (M) Sdn Bhd and Seng Hup Lightings & Decor Sdn Bhd, generating a combined monthly rental income of RM210,476.75.

The REIT noted that the acquisition is expected to be earnings accretive with strong recurring rental income and to benefit the REIT in the long term.

The acquisition will be funded through existing bank financing facilities and is expected to raise Axis REIT’s gearing ratio to 32.84%, still below the regulatory limit of 50%.

The proposed acquisition is expected to be completed in the second half of 2026.

Axis REIT’s unit price closed up three sen or 1.52% to RM2.01 on Wednesday, valuing the REIT at RM4.07 billion.