IOI Properties Plans to Raise About $515.7 Million Through REIT Listing

what happened

Malaysian developer IOI Properties expects to raise roughly $515.7 million, according to Dow Jones Newswires, by floating a real estate investment trust that holds some of its core income-producing assets. The IOIPG Malaysia Real Estate Investment Trust is slated to start trading on the main board of Bursa Malaysia on November 25. The fund would have a market value of 5.3 billion ringgit, about $1.3 billion, with units priced at 0.96 ringgit each.

The company would keep a controlling stake of up to 60%. The offering covers up to 2.2 billion units, including 715.6 million for retail investors and up to 1.48 billion for institutions. The opening portfolio contains nine freehold properties valued at 7.66 billion ringgit as of May 31, among them the IOI City Mall, six hotels under Marriott International brands and several office buildings. The trust is targeting a distribution yield of 6.6% for the financial year ending December 2027. Gearing is projected at 34.1% after listing, with total borrowings of about 2.65 billion ringgit.

why it matters

For markets, this is a notable REIT offering in Malaysia that gives investors exposure to income-generating property. The listing will add new securities to Bursa Malaysia and test demand for property funds in the region. Participants will watch the distribution yield and the level of debt as the key figures.

market impact

Malaysian REITs and Bursa Malaysia: the new listing adds supply and tests demand for property funds

tags

instruments