SUNWAY REIT PROPOSES TO ACQUIRE AN INDUSTRIAL PROPERTY FOR RM91.5 MILLION IN SHAH ALAM, SELANGOR

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1 MEDIA RELEASE 11 January 2017 SUNWAY REIT PROPOSES TO ACQUIRE AN INDUSTRIAL PROPERTY FOR RM91.5 MILLION IN SHAH ALAM, SELANGOR Maiden fray int prime industrial prperty in a strategic lcatin Lng tenure lease structure t enhance stability f incme stream Prtfli value increases by 1.4% t RM6.52 billin Bandar Sunway, 11 January 2017 Sunway REIT Management Sdn. Bhd., the Manager f Sunway Real Estate Investment Trust ( Sunway REIT ), is pleased t annunce that RHB Trustees Berhad, as trustee f Sunway REIT ( Trustee ), has entered int a cnditinal sale and purchase agreement ( SPA ) with Champin Edge Sdn. Bhd. t acquire an industrial prperty at Sectin 23, Shah Alam, Selangr fr a ttal purchase cnsideratin f RM91.5 millin. Prperty Descriptin Prperty descriptin : A tw strey ffice with an annexed ne-strey factry with mezzanine flr a three-strey ffice with an annex ne-strey warehuse and an integral twstrey ffice with a tw-strey factry cum warehuse with an adjining M&E building and ther ancillary buildings ( The Prperty ) Title details : H.S.(D) , Lt N. PT 65, Sectin 23, Bandar Shah Alam, Daerah Petaling, Negeri Selangr Darul Ehsan Tenure : Leasehld 99 years (expiring 30 May 2098) Land area : 62, square meters Categry f Land Use Purchase price (RM millin) : Industrial :

2 The Prperty is strategically lcated in the prime industrial hub f Shah Alam, Selangr and is predminantly ccupied by established multinatinals, lgistics and manufacturing cmpanies. The Prperty is easily accessible t the Kuala Lumpur city centre thrugh majr rads and expressways such as Federal Highway, ELITE Highway and Shah Alam Expressway ( KESAS ) as well as clse prximity t Kuala Lumpur Internatinal Airprt and Prt Klang, the largest sea gateway in the cuntry. The lease f the Prperty is structured n a triple-net-lease basis (where all csts and utgings in relatin t the Prperty are brne by the Lessee) thrugh a nvatin f an existing lease agreement. The lease has a remaining duratin f apprximately eighteen (18) years which shall expire n 31 December 2034 ( Initial Term ). The initial term will autmatically be extended fr ne further term f five (5) years ( Renewal Term ) n the same terms and cnditins. The Lessee has the ptin t ntify the Lessr in writing, nt less than 18 mnths prir t the end f the Initial Term if they d nt wish t renew the lease. The renewal term may als be extended t mre than five (5) years t a tenure f nt exceeding fifteen (15) years. Based n the initial year s annual rental f RM5.6 millin, this translates int an initial acquisitin yield (based n net prperty incme) f 6.12%. Thereafter, the net prperty yield is expected t increase t 6.73% upn the next rent review in Sunway REIT s prperty value will increase by 1.4% t RM6.52 billin, frm RM6.43 billin as at 30 June 2016, upn the cmpletin f the acquisitin f the Prperty. The Prperty will be classified alngside with the defensive incme prtin f Sunway REIT s asset prtfli as Others segment. The asset prtfli cmpsitin fr the Others segment will increase frm 5.0% t 6.4% upn cmpletin f the prpsed acquisitin based n prperty value as at 30 June The prpsed acquisitin will be fully funded by its existing debt prgramme. In line with Sunway REIT s investment strategy, the prpsed acquisitin is part f the diversificatin strategy t strengthen incme stability. In 2015, Sunway REIT has expanded its investment strategy t invest in lng tenure stable incme prducing assets such as industrial prperties, lgistics warehuses, data centres amngst thers. These assets shall nt exceed 15% f ttal asset value. Sunway REIT will remain retail fcused within a diversified asset prtfli spanning acrss key high grwth states in Malaysia. 2

3 Dat Jeffrey Ng, CEO f Sunway REIT Management Sdn. Bhd., said, We are pleased t annunce that Sunway REIT is making its maiden fray int the industrial prperty sub-sectr. Under the prevailing challenging perating envirnment, investment in this prperty ffers stable incme stream regardless f ecnmic and market cnditin. The prpsed acquisitin is backed by a lng lease and tenanted by a reputable tenant, hence, able t ffer Sunway REIT a resilient rental incme stream and cntribute psitively t its earnings and distributable incme. He added, Sunway REIT s asset will increase t 15 upn the cmpletin f the prpsed acquisitin and reinfrces its psitin as the secnd largest REIT in Malaysia with a prperty value f RM6.52 billin. We are n track t meet ur target f RM7 billin by FY2017. Abut Sunway Real Estate Investment Trust Sunway Real Estate Investment Trust ( Sunway REIT r Trust ) is ne f the largest retailfcused 1 real estate investment trusts ( REIT ) in Malaysia with a diverse prtfli strategically lcated acrss award-winning integrated twnships in key lcatins in Greater Kuala Lumpur, Penang, and Perak. Sunway REIT was listed n the Main Market f Bursa Malaysia Securities Berhad (Bursa Malaysia) n 8 July The market capitalisatin f Sunway REIT std at RM5.0 billin as at 10 January Sunway REIT is a cmpnent f FTSE-Bursa Malaysia Mid 70 Index, FTSE4 Gd Index and TR/GPR/APREA Cmpsite REIT Index Malaysia, FTSE EPRA / NAREIT Glbal REIT Index, FTSE EPRA / NAREIT Glbal Index, FTSE EPRA / NAREIT Asia ex Japan Index, FTSE EPRA / NAREIT Asia Pacific Index and FTSE EPRA / NAREIT Emerging REIT Index. Sunway REIT wns a prtfli f 14 assets cmprising 4 retail malls, 5 htels, 4 ffices and a medical centre. Prperty value std at RM6.43 billin as at 30 June Sunway REIT s assets are primarily lcated in Sunway City where its flagship asset, Sunway Pyramid Shpping Mall, is lcated. The ther assets lcated in SRC include Sunway Resrt Htel & Spa, Sunway Pyramid Htel (frmerly knwn Sunway Pyramid Htel East), Menara Sunway and Sunway Medical Centre. On the nrthern Peninsular f Malaysia, Sunway REIT wns SunCity Iph Hypermarket in Perak. 3

4 On the mainland f Penang, Sunway REITs wns Sunway Htel Seberang Jaya and Sunway Carnival Shpping Mall. In FY2015, Sunway REIT added tw assets int the prtfli, namely Wisma Sunway in Shah Alam, Selangr and Sunway Htel Gergetwn, marking its maiden fray int Penang Island. Sunway REIT wns fur prperties in in Kuala Lumpur, namely Sunway Twer and the remaining three assets which cnstitute part f the 3-in-1 integrated develpment, Sunway Putra (frmerly knwn as Sunway Putra Place). Sunway Putra cnsists f Sunway Putra Mall, Sunway Putra Htel and Sunway Putra Twer. 1 Retail-fcused is defined as at least 60% cntributin frm the retail assets t prperty value, revenue r NPI. Imprtant ntice Kindly read this media release in cnjunctin with the annuncement released t Bursa Malaysia dated 11 January 2017 fr a mre cmprehensive understanding f Sunway REIT s annuncement. This media release may cntain certain frward lking statements due t a number f risks, uncertainties and assumptins. Representative examples f these factrs include (withut limitatin) general industry and ecnmic cnditins; interest rate trends; cst f capital and capital availability including availability f financing in the amunts and the terms necessary t supprt future business; availability f real estate prperties; cmpetitin frm ther cmpanies; changes in perating expenses including emplyee wages, benefits and training, prperty expenses, gvernment and public plicy changes. Yu are cautined nt t place undue reliance n these frward lking statements which are based n Management s current view f future events. Past perfrmance is nt necessarily indicative f its future perfrmance. 4

5 Fr mre infrmatin, please cntact: Crystal Teh Sunway REIT Management Sdn. Bhd. (As Manager f Sunway Real Estate Investment Trust) Tel : Fax : Mbile : crystaltll@sunway.cm.my Website f Sunway REIT: 5