CapitaMalls confirms Tropicana purchase

CapitaMalls has completed due diligence in its bid for Tropicana City Mall and Office Tower in Selangor, Malaysia.

CapitaMalls will pay RM540 million (US$146.4 million) for the complex through its Malaysian subsidiary CapitaMalls Malaysia Trust (CMMT). Settlement is likely to be completed by July 1.

CapitaMalls says the property’s Net Property Income is RM33.00 million, which has been derived by annualising the Property’s NPI forecast of RM16.50 million for the six month period to December 31, 2015 (assuming that the Proposed Acquisition is completed on 1 July 2015). This translates into a property yield of about 6.1 per cent.

The four level Tropicana City Mall opened in 2008 and has a net lettable area of 448,248 sqft and 1759 car park. It is attached to a 12-storey office building.

As of January 15, the mall had an occupancy rate of 89.2 per cent and the office tower was fully leased. CapitaMalls had previously considered buying the mall in mid 2013, but the negotiations ended after both parties were unable to agree to purchase terms.

“The proposed acquisition will further strengthen CMMT’s position as a sizeable, well geographically diversified shopping mall real estate investment trust in Malaysia,” CMMT said in an earlier statement.