Axis REIT completes maiden RM300m senior sukuk issuance

• Axis REIT said proceeds from the sukuk issuance will be used to finance capital and development expenditure, working capital, general corporate purposes and to refinance existing or future Islamic financing.

KUALA LUMPUR (Aug 15): Axis Real Estate Investment Trust (Axis REIT) (KL:AXREIT) has completed its maiden issuance of RM300 million senior Islamic medium-term notes under its RM3 billion sukuk programme.

The sukuk carries a 10-year tenure with a fixed profit rate of 4% per annum, payable semi-annually. It is rated AA2(s) with a stable outlook by RAM Rating Services Bhd, according to Axis REIT's bourse filing on Friday.

Axis REIT said proceeds from the sukuk issuance will be used to finance capital and development expenditure, working capital, general corporate purposes and to refinance existing or future Islamic financing.

Following the issuance, Axis REIT said its fixed-rate financing ratio is expected to rise from 48% to 65%, enhancing cost management.

Axis REIT Managers Bhd chief executive officer and executive director Leong Kit May described the issuance as “a significant step in diversifying our funding sources and supporting our growth ambitions”.

"The proceeds will serve as a war chest for us to seize strategic opportunities, acquire income-accretive assets and further strengthen our balance sheet for long-term sustainability," she added in a separate statement.

As at June 30, 2025, Axis REIT had a portfolio of 68 shariah-compliant properties across the Klang Valley, Johor, Penang, Pahang, Negeri Sembilan and Kedah, with an occupancy rate of 97% and a weighted average lease expiry of 4.6 years.

The portfolio spans 15.11 million sq ft of net lettable area with a total asset value of RM5.21 billion.

For the second quarter ended June 30, 2025, Axis REIT's net income rose to RM46.95 million, up from RM38.96 million a year earlier, driven by contributions from newly acquired assets, fresh tenancies and upward rental revisions across its portfolio. Earnings per unit rose to 2.32 sen from 2.23 sen.

Following the 2Q dividend of 2.65 sen per unit, the REIT's year-to-date payout rose to 5.15 sen per share, up from 4.55 sen in the prior year.

Axis REIT’s units ended up one sen or 0.49% to RM2.06 on Friday, giving the trust a market capitalisation of RM4.16 billion.

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