PETALING JAYA (July 7, 2026): KIP Real Estate Investment Trust (KIP REIT) has received approval from Bursa Malaysia Securities Bhd to list and quote up to 220 million new units under its proposed private placement, paving the way for the equity fundraising component of its RM435 million acquisition of Setapak Central Mall in Kuala Lumpur.

The approval marks a key milestone in completing one of KIP REIT's largest acquisitions, which is expected to significantly expand its retail property portfolio and assets under management.

Equity fundraising to support acquisition

According to a Bursa Malaysia filing, the proposed placement forms part of the financing package for the acquisition of Setapak Central Mall.

KIP REIT had previously appointed CIMB Investment Bank Bhd and Maybank Investment Bank Bhd as joint placement agents before submitting its listing application to Bursa in June 2026.

With Bursa's approval now secured, the REIT can proceed with the proposed placement, subject to unitholder approval and the fulfilment of other regulatory conditions.

Balanced funding structure

The acquisition will be funded through a combination of bank borrowings and private placement, based on an approximate 60:40 debt-to-equity financing mix.

The seller and purchaser previously entered into a conditional sale and purchase agreement through Pacific Trustees Bhd, acting as trustee for KIP REIT.

High-quality retail asset with strong occupancy

Setapak Central is a leasehold three-storey shopping mall with a basement car park located in Setapak, Kuala Lumpur.

The mall offers a net lettable area (NLA) of approximately 514,777 sq ft and achieved an impressive 99.9% occupancy rate as at February 28, 2026.

For FY2025, the property generated RM31.3 million in net property income, representing an acquisition yield of approximately 7.2% based on the RM435 million purchase price.

Upon completion, Setapak Central will become KIP REIT's 19th property and its largest asset by value, increasing the trust's total portfolio NLA by approximately 15.6%.

Portfolio expansion ahead of target

The acquisition is expected to increase KIP REIT's assets under management (AUM) from approximately RM1.7 billion to RM2.1 billion, allowing the REIT to exceed its RM2 billion AUM target for 2027 ahead of schedule.

Its market capitalisation is also projected to grow to around RM1 billion.

Management expects the acquisition to be distribution per unit (DPU)-accretive over the long term, supporting sustainable income growth for unitholders.

Strong financial momentum

KIP REIT continued to deliver solid operating performance during FY2026.

For the third quarter ended March 31, 2026:

Gross revenue increased 12.9% year-on-year to RM44.6 million.

Net property income rose 17.6% to RM32.3 million.

Profit after tax grew 31.4% to RM18.2 million.

For the first nine months of FY2026:

Gross revenue climbed 33.9% to RM128.9 million.

Profit after tax increased 47.5% to RM52.9 million.

A third income distribution of 1.73 sen per unit was proposed, bringing the cumulative year-to-date distribution to 5.23 sen per unit.

KIP REIT currently owns 18 properties across Malaysia, including suburban retail malls, industrial assets and neighbourhood shopping centres, with a combined net lettable area exceeding 3.2 million sq ft.

Key Takeaways

Bursa Malaysia's approval allows KIP REIT to proceed with a private placement of up to 220 million new units to partially finance the RM435 million acquisition of Setapak Central Mall.

The acquisition will be funded using a balanced 60% debt and 40% equity financing structure, helping to manage leverage while supporting portfolio growth.

Setapak Central is a high-quality retail asset with 99.9% occupancy and an attractive acquisition yield of approximately 7.2%, providing immediate recurring rental income.

The acquisition will increase KIP REIT's assets under management to approximately RM2.1 billion, exceeding its 2027 growth target ahead of schedule.

Setapak Central will become KIP REIT's largest property and expand its total net lettable area by around 15.6%.

The REIT continues to deliver strong financial performance, with double-digit growth in revenue, net property income and profit, supporting higher distributions to unitholders.

The transaction reflects KIP REIT's strategy of acquiring stabilised, income-producing retail assets that are expected to enhance long-term distribution per unit (DPU) for investors.