YTL to launch Starhill REIT

Close on the heels of the successful listing of the Axis Real Estate Investment Trust (Axis REIT), property giant and power producer YTL Corp Bhd plans to list its Starhill REIT in October, and sell shares to the public.

The group will sell its Starhill Shopping Centre, JW Marriott Hotel and part of the Lot 10 retail mall in Kuala Lumpur’s Bukit Bintang locale to the REIT for RM1.2 billion.

According to valuers in the city, the YTL properties are quality, Grade A buildings that are well tenanted.

Earlier statements from YTL said the Starhill REIT was expected to have a fund size of 1.04 billion units and offer a yield of 6.19 per cent per annum.

YTL is expected to hold 51 per cent of the shares.

Starhill Shopping Centre, which is fully occupied, has 280,385sq ft of retail space and generated RM21.6 million in rental income last year.

The 24-storey JW Marriott brings in RM1.71 million in average rental income per month and has been recording an occupancy rate of 75 per cent.

The 430,400sq ft Lot 10 generated RM21 million in rental income last year.

REIT offerings have been receiving enthusiastic public attention since the Government revised the REIT Guidelines last year.

The Axis REIT was oversubscribed when it closed its initial public offering last month. Institutional investors asked for about 18 times more than the 81.4 million units on offer, while the retail portion of 15 million units was also oversubscribed by 3.72 times.

– Property Times 20 August 2005 issue –