KUALA LUMPUR (April 19): Hektar Real Estate Investment Trust (Hektar REIT) aims to double its portfolio asset value to RM2.4 billion by 2026, by acquiring at least four assets over the eight-year period.
As at Dec 31, 2017, the REIT's asset value stood at RM1.2 billion following last year's acquisition of Segamat Central, bringing its total net lettable area (NLA) to 2 million sq ft.
Hektar REIT executive director and chief executive officer Datuk Hisham Othman said the trust is looking to acquire assets valued between RM300 million and RM400 million subject to its extensive review process.
"We look at the prospects of the surrounding area of the asset and prefer assets that are yield accretive, that can quickly contribute and provide a decent return.
"We also consider the potential of the mall and see how we can enhance it moving forward, to create greater value," he told the press at a briefing following Hektar REIT's annual general meeting today.
He added that the REIT is open to opportunities and was even looking at assets in Sabah and Sarawak to add to its portfolio, but said there has been no plan cast in stone yet.
Meanwhile, Hisham said the trust will focus on growing organically via its ongoing asset enhancement initiatives for Subang Parade (RM30 million) and Kulim Central (RM22 million).
Despite talks of oversupply in shopping malls, he said the REIT is still very much focused on the retail sector and catering to the changing preferences of the consumers.
"Our strategy is still retail. Retail is flexible, we can play around with the tenant mix to match with the times, to attract greater footfall.
"For example, we have seen a general increase in the proportion of food and beverage (F&B) tenants in malls, including those in our portfolio, as compared to fashion outlets," he said.
He explained that the lower proportion of clothing outlets is likely due to changing consumer habits as online shopping and e-commerce continue to gain traction.
Meanwhile, consumers nowadays head to shopping malls as a place to socialise, leading to the increase in F&B outlets.
For FY17, Hektar REIT's net property income fell 0.8% to RM73.74 million from RM74.34 million a year earlier, while revenue increased 0.7% to RM125.54 million from RM124.57 million.
The REIT announced a distribution of 9.6 sen per unit for the financial year, translating to a yield of 7.4%.