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PETALING JAYA (Sept 18): KIP Real Estate Investment Trust (KIP REIT) plans asset enhancement initiatives (AEIs) at KIPMall Masai, KIPMall Kota Warisan and AEON Mall Kinta City to improve operational efficiency and support long-term rental growth.
In a Bursa Malaysia filing on Friday (Sept 18), the REIT said it would incorporate energy-efficiency measures, renewable-energy initiatives and other sustainability-focused improvements into the AEIs where appropriate.
Its annual report did not disclose the scope, cost or implementation schedule for the planned works.
KIP REIT invested RM20.42 million in AEIs during the financial year ended June 30, 2026 (FY2026), primarily at KIPMall Tampoi. About RM13.64 million was spent on the mall’s transformation.
KIPMall Tampoi reopened in February following upgrades to its fresh market, food hall, façade, common areas, lighting and shopper facilities. The works also added about 824 sq ft of net lettable area and 120 motorcycle parking bays.
Its occupancy recovered to 97.7% as at June 30 from 92.6% during the works in the second quarter of FY2026. KIP REIT said the upgraded shopping environment and repositioning of the mall contributed to stronger car park collections.
Setapak Central acquisition
KIP REIT is targeting completion of its proposed RM435 million acquisition of Setapak Central Mall by the end of the third quarter of 2026.
The transaction, its largest acquisition to date, would mark KIP REIT’s entry into Kuala Lumpur and increase its assets under management to about RM2.2 billion from RM1.76 billion. This would surpass its RM2 billion target for 2027 ahead of schedule.
Setapak Central had an occupancy rate of 99.9% as at Feb 28 and an implied property yield of 7.2%, based on the purchase consideration and its net property income (NPI) of RM31.3 million for 2025.
The acquisition is to be funded through a 65:35 mix of bank borrowings and private placement proceeds. KIP REIT completed the placement of 200 million new units in August, raising approximately RM163 million.
Upon completion, Setapak Central will become KIP REIT’s 20th income-producing asset and increase its portfolio net lettable area by about 15.6%.
For FY2026, KIP REIT’s gross revenue rose 30.1% to RM177.1 million from RM136.13 million a year earlier, while NPI increased 34.1% to RM129.86 million from RM96.82 million.
Realised profit climbed 42.6% to RM73.1 million from RM51.27 million, while distributable income increased 41.4% to RM74.53 million from RM52.72 million. Distribution per unit rose to 7.26 sen from 6.8 sen.
As at June 30, its portfolio comprised 13 retail and six industrial assets valued at RM1.76 billion, with a combined net lettable area of 3.26 million sq ft. The portfolio average occupancy rate improved to 98.4% from 96.7% in FY2025.
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