One of Europe's leading real estate investment management companies, Union Investment Real Estate AG, has inked a deal to buy Bandar Raya Developments Bhd's (BRDB) Capital Square Office Tower 2 in Kuala Lumpur for RM440 million.
The agreement was signed with BRDB subsidiary Capital Square Sdn Bhd (CSSB) and represents Union Investment's foray into the property sector in Malaysia.
"It is testimony to the confidence foreign investors have in the Malaysian economy," BRDB chief executive officer Datuk Jagan Sabapathy said.
The Office Tower 2, which will be completed by 2010, is a 41-storey Grade A office building with nett lettable area of 600,000sq ft situated within the 15.2-acre CapSquare integrated development.
Other components include a condominium block and the North and South Office Towers.
Based on the purchase price and estimated size of the tower, the deal equates to a value of RM730psf.
Union Investment's purchase, Jagan said, not only reflects the company's confidence in BRDB's products and in the company as a developer, but also in the Malaysian real estate market.
Union Investment is a leading international investment management company, specialising in open-ended real estate funds for private and institutional investors.
Assets under its management amount to 13.8 billion (RM66.1 billion). Portfolios in its open-ended real estate funds include some 150 properties and projects in Europe, the Americas and Asia.
"In line with our expanding business, we have been looking for opportunities to invest in Malaysia as the country's real estate market is very attractive," said Union Investment Singapore managing director and head of its Asia Pacific Markets, Steffen Wolf.
"We believe the future of the Malaysian commercial real estate market is very bright."
"Our strategy is to invest in commercial products of distinctive quality and CapSquare is one such product."
In the last two years, Wolf said, Union Investment has invested in 12 new markets, including Japan, Singapore, South Korea, Hungary, the Czech Republic, Mexico and Chile.
Active in the property investment business for over 40 years, Union Investment Real Estate AG now operates in 22 countries around the world, with approximately 50 per cent of its property assets located in countries outside its domestic market.
The BRDB Group is principally involved in the development and management of prime residential and commercial properties in country.
Among its landmark developments are the Foster & Partners designed Troika in Jalan Binjai, KL, Bangsar Shopping Centre and the Permas Jusco mall in Johor Baru.
By New Straits Times
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