Malaysia-listed retail and office real estate investment trust, AmFirst REIT, has announced that it will be acquiring the Mydin Hypermall in Jalan Baru, Penang for a total cash consideration of MYR250 million (SGD92 million).

AmFirst REIT has indicated that acquisition of the three-storey mall will be funded by bank borrowings, increasing its gearing to 42.8% from 32.65%. Building of the mal is currently in progress.

Upon acquisition, the property will be leased back to the operators of the mall, Mydin Wholesale Cash and Carry on a 30-years lease with a 10% rent increment every 5 years commencing immediately upon completion of the acquisition.

AmFirst REIT has described the acquisition as one that it consistent with its objectives of providing a stable accretive yield and capital growth potential for the longer term. “This is also strategic expansion into the retail sector while achieving a geographical diversification”, said the REIT in a filing with Bursa Malaysia.

Units of AmFirst REIT last changed hands on the Bursa Malaysia at MYR0.94.