The Employees Provident Fund (EPF) decided to sell its property investments in Britain – Tower Bridge House at St Katharine Docks and St James Square in the West End – as they feel that their prices had already peaked and it was time to reap the benefits, reported The Star.
“We believe the values of these buildings are at their peak, and therefore, it should be the right time for us to realise the capital gains,” it said in slamming reports that it decided to sell the properties in response to government’s call for government-linked investment funds to liquidate foreign assets and bring the money home to help the weakening ringgit.
It explained that its decision is “part of (its) investment strategy to maximise returns to its contributors. We will sell the investments when the value of the properties are high and based on the market cycle”.
In fact, EPF believes that it would “recognise profits from the sale and (would) eventually distribute them as dividends in the year we sell”.
However, the fund manager plans to redeploy the capital for new investments abroad.
“Our investment parameters in terms of countries outside Malaysia remain the same. We will look for investment that matches our return parameter,” said EPF.
EPF acquired both Tower Bridge House and St James Square in 2011 for £163 million (RM906 million) and £147.5 million (RM819.92) respectively. Sources said EPF is looking to sell Tower Bridge House for £200 million (RM1.112 billion) and St James Square for £204.75 million (RM1.138 billion).
If the sale goes through, EPF will reap £100 million (RM556 million) in profit from the two office properties.
In a release, EPF revealed that its investment income for the third quarter ended 30 September 2016 rose 29.21 percent year-on-year to RM12.32 billion from RM9.54 billion a year ago.
As at 30 September 2016, the fund manager had an investment fund size of RM712 billion. Infrastructure and real estate accounted for 3.80 percent of total investment assets while contributing RM478.22 million in investment income during the period.
Radin Ghazali, Content Writer at PropertyGuru, edited this story. To contact her about this or other stories email radin@propertyguru.com.my
