KUALA LUMPUR (July 1) : AmFIRST Real Estate Investment Trust (AmFIRST REIT) is disposing of Menara AmFIRST in Petaling Jaya, Selangor for RM62 million cash.

In a Bursa Malaysia filing, the REIT said the 22-storey building will be disposed of to a private limited company, Forever Backup Sdn Bhd.

Following the disposal, the REIT will incur net loss on disposal of RM4.93 million.

It is noted that Menara AmFIRST was first acquired by the REIT in 2006 for an initial cost of RM57.1 million. As at end-March, its audited net book value stood at RM64.6 million.

“The manager opines that considering the age and limited scope for growth of the asset, it is opportune to dispose of this asset to repay existing borrowings to optimize the trust’s gearing level,” the REIT said.

It added that the proceeds will be used to pare down its existing borrowings.

The proposed disposal is expected to be completed by 3Q22, it said.  

According to the latest AmFIRST REIT annual report, the group owns several properties in Klang Valley, namely Bangunan AmBank Group, Menara AmBank, Wisma AmFIRST, The Summit Subang USJ, and Prima 9 & 10 in Cyberjaya.

It also owns Mydin Hypermall in Bukit Mertajam, Penang and Kompleks Tun Sri Lanang in Melaka.

AmFIRST REIT closed unchanged at 39 sen on Friday (July 1), giving it a market capitalisation of RM264.26 million.