Main Market-bound Paradigm REIT aims to raise RM560mil from IPO next month
PETALING JAYA: Main Market-bound Paradigm Real Estate Investment Trust (Paradigm REIT) aims to raise RM560 million from its initial public offering (IPO).
Paradigm REIT said in a statement today that upon listing, scheduled for June 10, 2025, it is expected to achieve an estimated market capitalisation of RM1.6 billion based on the illustrative issue price of RM1 per offer unit and a total listing of 1.6 billion units.
"Paradigm REIT's IPO is poised to be the largest Malaysian REIT IPO in the past 13 years and one of the largest IPOs in Malaysia for 2025.
"This shows the ability and depth of the Malaysian equity capital market to support large capital raises despite market volatility arising from the ongoing trade war," it said.
It noted that the IPO provides opportunities for investors and unitholders to invest in a real estate investment that offers stable income distribution and potential capital appreciation on investment in the units, and allows Paradigm REIT to gain access to capital markets to raise funds for future real estate acquisitions.
Meanwhile, Paradigm REIT Management Sdn Bhd director of investment, finance and accounts Chong Kian Fah said he is confident that the REIT could achieve its estimated market capitalisation amid market turbulence, classifying the REIT as a defensive stock.
He said Paradigm REIT's IPO differs from the usual IPO and is more akin to a fixed income-type investment, coupled with the REIT's performance.
"Currently, there are a few benchmarks that you can use to gauge whether the assets are competitive. First is the occupancy – whereby the occupancy of a mall, on average, is close to 99 per cent.
"The second is our net property income (NPI) margin. So, for last year, our NPI margin was close to 64 per cent. And we are aiming to achieve 26 per cent this year," he told a press conference after the prospectus launch ceremony here today.
Currently, Paradigm owns Bukit Tinggi Shopping Centre, Paradigm Mall Petaling Jaya, and Paradigm Mall Johor Bahru – three assets valued at RM2.4 billion.
Based on the retail price of RM1 per unit, the projected annualised distribution yield for 2025 exceeds seven per cent.
The IPO comprises a total offering of up to 560 million offer units, of which 254.7 million units are allocated for the retail offering and at least 305.3 million units are offered to institutional investors.
"The retail offering comprises approximately 32 million offer units for application by the Malaysian public, of which 16 million units are reserved for bumiputera investors, 27.8 million units for eligible persons, and up to 194.86 million units for entitled shareholders of WCT Holdings Bhd on the basis of one unit for every eight existing shares held as at 5 pm on the entitlement date.
WCT Holdings retains 65 per cent ownership in Paradigm REIT indirectly through its main shareholder.
"Meanwhile, the institutional offering consists of 200 million offer units reserved for bumiputera investors approved by the Ministry of Investment, Trade and Industry, and the remaining 105.3 million offer units for other institutional and selected investors," it said.
Paradigm REIT Management chief executive officer Chua Kah Noi said four assets – namely Hyatt Place Johor Bahru Paradigm Mall, Le Meridien Petaling Jaya, Premier Hotel Klang, as well as Gateway@Kuala Lumpur International Airport (KLIA) Terminal 2 – will be injected into Paradigm REIT.
"I think we are looking as early as 2026 to inject the hotels – the three hotels – and then maybe 2027 or 2028 for Gateway@KLIA2," she said.
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