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KUALA LUMPUR (March 18): Axis REIT (KL:AXREIT) aims to convert its remaining loans to sustainability-linked financing and explore more of such funding as the real estate investment trust expands its portfolio.
Converting the financial facilities would be in line with its capital structure as well as its environmental, social and governance principles, the REIT said in its annual report released on Tuesday. The trust said it will also benefit from profit rebates tied to achieving pre-agreed sustainability targets.
"To ensure alignment with sustainability-linked financing criteria and to qualify for applicable rebates, we will work towards achieving the predefined green building certification targets,” Axis REIT said.
Axis REIT now has a portfolio of 69 properties, spanning industrial, office, hypermarket and logistics warehouse assets. The portfolio comprises about 15 million sq ft of net lettable area.
The trust has previously stated its target to increase its assets under management to RM10 billion by end-2030 from about RM5 billion at the end of 2025. Financing totalled RM1.73 billion as at end-2025 and the trust secured RM100 million in sustainability-linked financing last year.
“We will ensure sufficient liquidity to fund these ambitions and, at the same time, aim to convert the fund’s remaining facilities to sustainability-linked financing and explore opportunities for further green financing or sustainability-linked sukuk issuances,” Axis REIT said.
The trust also said in the annual report that it is engaging with policymakers and other stakeholders to renew the concessionary 10% withholding tax rate on REIT dividends in order to “protect the attractiveness” of the asset class.
“We will continue to strongly advocate for a resolution that supports the long-term stability and competitiveness of the sector as a whole,” Axis REIT added.
The government is now reviewing whether to continue providing the preferential tax rate on REIT dividends, which has been in place from 2016 to 2025, as the sector is now considered mature and commercially viable, Finance Minister II Datuk Seri Amir Hamzah Azizan said in February.
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