Hektar Reit buys 90pct of Terramark for RM26mil
Terramark is a real estate holding company supported by a parcel of land measuring 80.1 hectares in Chuping, Perlis.
Hektar Asset said the acquisition represents Hektar Reit's entry as the first Malaysian Reit to undertake a transaction based solely on a ground lease model.
The company noted that while the ground lease model is still relatively new in Malaysia, it has already proven successful in more established Reit markets like the United States, showcasing its potential for long-term value creation.
"This landmark transaction further marks a pioneering move by a listed Malaysian Reit into the renewable energy sector, underscoring Hektar Reit's strategy to future-proof its income streams and diversify into environmental, social and governance (ESG) aligned asset classes," it said.
Hektar Asset said the acquisition presents strategic opportunities, including the potential to source clean energy from the solar farm at competitive rates for use across its property portfolio.
This would help manage operational costs amid inflation, lower its carbon footprint, and improve its ESG performance, ultimately supporting its goal of strengthening its triple-bottom-line outcomes.
"The acquisition represents a strategic seed investment, a deployment of capital into long-duration, ESG-driven assets that are expected to deliver inflation-protected, high-visibility income for decades to come.
"This transaction is a material step in Hektar Reit's diversification strategy, aimed at building a Reit model with embedded sustainability drivers, stable, long-duration low-risk rental income," it added.
Hektar Asset said by investing in the land, it helps Hektar Reit reduce the upfront capital needed by renewable energy developers, making it easier for it to enter the market and improving the financial viability of its projects.
Hektar Asset executive director and chief executive officer Zainal Iskandar said the acquisition lays the foundation for generating long-term, inflation-hedged income while contributing to Malaysia's renewable energy objectives.
"Coupled with its rooftop solar rollout and recent industrial investment, this first move on a pure ground-lease model positions Hektar Reit as a multi-asset platform creating sustainable value.
"Globally, Reits integrating renewable infrastructure into their portfolios have seen increasing institutional investor interest, driven by the shift toward ESG mandates and stable yield profiles," he said.
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