TM is a tenant of Menara TM, corporate offices to be moved to other TM properties

Telekom Malaysia (TM) has issued a statement following the circulation of a property ad for Menara TM located at Jalan Pantai Baharu, Kuala Lumpur. It clarified that the office tower no longer belongs to them and they are currently leasing the building which serves as their headquarters.

TM has confirmed that Menara TM is now owned by Menara ABS Berhad and they are not involved in the sale of the property. The telco added that they are already in the process to move its corporate offices to other TM buildings. Interestingly, both TM Annexe 1 and Annexe 2 are still owned by the telecommunications giant after it put both towers for sale in 2019. Below is the statement from TM:

Telekom Malaysia Bhd (“TM” or “the Company”) would like to clarify that the Company is a tenant of Menara TM, located at Jalan Pantai Baharu, Kuala Lumpur.

TM does not own the said building, and is not involved with its intended sale by the property’s owner, Menara ABS Bhd.

The Company is currently in the process of relocating the majority of its corporate offices into its TM-owned properties, including TM Annexe 1 and TM Annexe 2 as well as its properties in Cyberjaya, as part of the Company’s optimisation programme to enable greater efficiency and agility, and to accommodate hybrid working conditions.

Telekom Malaysia

TM has also confirmed that their current lease agreement at Menara TM lapses in January 2023 and they have no intention of renewing the lease or reacquiring the property. It added that the decision to move their offices will enable significant cost savings from a rental and maintenance perspective. It said in a post-pandemic work environment, it is evident that they no longer require the conventional use of office space.

TM had sold and leaseback Menara TM, Menara Celcom, TM Cyberjaya Complex and Wisma TM to Menara ABS in 2008 for RM1 billion through the issuance of Sukuk. In July 2021, RAM Ratings had downgraded Menara ABS’s Tranche A Sukuk to negative due to concerns over a short time window to reach a resolution on lease negotiations and disposal of the underlying properties. In pursuant to TM’s decision to not exercise its rights to buy back Menara TM, TM Semarak and TM Taman Desa (Unsold Properties), the issuer has appointed real estate adviser, WTW Real Estate Sdn Bhd (CBRE), to plan and drive asset leasing and process to dispose of the properties in the open market.