KUALA LUMPUR (June 8): UOA Real Estate Investment Trust (UOA REIT) is disposing of Wisma UOA Pantai at Off Jalan Pantai Baru here to CIMB Bank Bhd for RM120 million cash.

UOA REIT said the property was operating at a low occupancy rate of 19% as at April 2018 and the disposal is in line with the objective of its manager UOA Asset Management Sdn Bhd of maximising returns to the unitholders of the trust which includes disposal of properties.

In a filing with Bursa Malaysia today, UOA REIT said UOA Asset Management has entered into a sale and purchase agreement with CIMB Bank for the proposed disposal.

The net book value of the property based on the unaudited financial statements of UOA REIT as at May 31, 2018 was RM117.5 million. The net capital gain arising from the disposal is estimated to be RM541,000 after taking into account all related expenses on the disposal.

"The net sales proceeds of approximately RM118 million will be utilised to reduce existing bank borrowings of UOA REIT," it added.

"Barring any unforeseen circumstances, the disposal is expected to be completed by the second quarter of 2018," said UOA REIT.

UOA REIT units closed unchanged at RM1.43 today, for a market capitalisation of RM604.7 million.