Friday 29 Mar 2024
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KUALA LUMPUR (Jan 7): Penang-based Ideal Sun City Holdings Bhd is buying 15 leasehold units at the Anzen Business Park in Taman Maluri here for RM6.15 million to generate more stable returns and earn recurring rental income.

In a bourse filing, Ideal Sun City said its wholly-owned unit Ideal Property Concept Sdn Bhd entered into 15 sale and purchase agreements with vendor Tan Hua Meng for the light industry properties with a 99-year leasehold that expires on Nov 27, 2079.

"All 15 properties are rented out with an average gross rental yield of approximately 5.9% per annum based on the market value.

"The acquisition would allow the group to expand its property base not only in terms of the number of properties but also in other locations, which would reduce the concentration risk of the properties owned by the group," it said.

Its board also believes that the acquisition will put the existing and prospective funds of the group to better use "by generating more stable returns and recurring income from the rental of the properties".

Barring any unforeseen circumstances, the acquisition, to be funded through internally generated funds, is expected to be completed in three months from the date of the agreements.

"The properties are intended to be held on a long-term basis with a view of positive returns from appreciation in real estate prices as well as rental income to be derived on a recurring basis.

"The board is of the view that the long-term prospects of holding the properties are good and will contribute positively to the earnings of the group," it said.

Ideal Sun City, mainly involved in project design evaluation, project value engineering and project construction management, closed half sen or 1.05% lower at 47 sen today for a market capitalisation of RM88.5 million.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

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