Fall of a giant: Ayala Land loses premium as Sy-blings’ SM Prime, Frederick Go’s Robinsons Land take top spot among property stocks – JP Morgan

 

JP Morgan is projecting a seismic shift in Philippine property stocks with former industry leader Ayala Land Inc. losing its premium valuation among peers.

“ALI’s premium valuation was anchored on profit growth consistency and outperformance relative to peers; this is no longer the case today,” said JP Morgan in a June 30 report which has been widely shared on social media.

After leading the industry in profit growth since 2009, JP Morgan expects ALI to place last among the Big Five property companies in the country in terms of net income growth.

ALI is the only Big Five property player to post negative growth in profits (minus four percent) from 2019 to 2024 after posting an industry-leading 23 percent average growth rate from 2009 to 2019.

Robinsons Land Corp. (RLC) led by bilyonaryo Frederick Go will have the highest profit growth rate through 2024 at seven percent, followed by SM Prime Holdings (SMPH) of the Sy family with five percent, Megaworld Corp. of ultra bilyonaryo Andrew Tan with two percent.

Filinvest Land Inc. of the Gotianun family is expected to have a zero growth average from 2019 to 2024.

JP Morgan said it preferred SMPH and RLC with their high, recurring income streams (leases) over ALI due to its high reliance on residential sales for growth.

It blamed ALI’s fall from grace to “murky growth outlook, elevated residential inventory and cancellations.”

JP Morgan reckoned it would take more than 21 months for ALI to sell its inventory of residential properties.

Profit margins are likely to erode further as ALI will unlikely be able to increase its average selling price and will be forced to give easy payment terms in view of the weak demand and high interest rates.

Based on its estimates, JP Morgan said SMPH now has the highest premium valuation among the Big Five (24 times price/earnings ratio for 2023) with ALI falling to second with a P/E of 17 (from a an average P/E of 27.8 from 2009 to 2019. RLC is third with a P/E ratio of 8.6 times in 2023 followed by FLI (4.3 times P/E) and MEG (4.2 times P/E).

SOURCE: Bilyonaryo

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Andrew Tan’s REIT posts 18% rise in distributable net income

 

MREIT, the real estate investment trust of ultra bilyonaryo Andrew Tan’s Megaworld Corp., chalked up distributable income of P639 million in the first quarter, up 18 percent on new contributions from recent acquisitions.

The company reported a net income of P687.2 million on the back of P901.6 million in revenues.

Last December, four income-generating properties valued at P9.1 billion were infused into MREIT. This expanded MREIT’s portfolio GLA by 25 percent from 224,000 square meters during its initial public offering to 280,000 sqm with occupancy rate averaging at 96 percent, with five office assets registering 100 percent occupancy.

As of end-March, the company’s portfolio value stood at P59.3 billion

“Our solid performance in the first quarter of 2022 affirms our efforts to sustain MREIT’s growth via a combination of organic and inorganic means. The combination of rent escalation, steady occupancy, and implementation of our acquisition plans puts us on track to deliver on our targeted returns for our shareholders in 2022,” said Kevin L. Tan, president and CEO of MREIT.

The company plans to declare dividends amounting to P1 per share this year, six percent higher than the original plan.

MREIT said an additional four prime properties worth P5.3 billion will be added to its investment portfolio. Once completed, the acquisition will boost MREIT’s portfolio GLA by 16 percent to 325,000 sqm.

SOURCE: Bilyonaryo

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Andrew Tan’s leisure unit bounces back with positive growth numbers: GERI posts P1.3B earnings in 2021

The leisure estate development arm of ultra bilyonaryo Andrew Tan, Global-Estate Resorts Inc. (GERI) swung back to positive territory with profit rising 21 percent to P1.3 billion last year.

Consolidated revenues, however, declined to P5 billion from P5.2 billion even as real estate sales increased by three percent to P3.7 billion amid strong demand for leisure developments.

Reservation sales grew by 25 percent to P17.2 billion with Boracay Newcoast accounting for the biggest chunk of the company’s property sales with P4.1 billion worth of projects sold in 2021.

This was followed closely by Eastland Heights and Alabang West, which chalked up sales of P3.6 billion and P3.4 billion, respectively.

Also boosting sales were Arden Botanical Estate, Southwoods City, and Twin Lakes with a combined contribution of P5 billion.

“For 2021, we continued to capitalize on the strong demand for properties in the provinces. Aside from the intrinsic attractiveness of owning a place that allows you to commune more closely with nature, the past couple of years also highlighted the potential of owning real estate as an investment. In fact, the underlying land values for our offerings continued to appreciate at a brisk pace in spite of the pandemic,” said Monica T. Salomon, president of GERI.

Leasing leasing revenues, on the other hand, declined by 34 percent to P409 million as consumer confidence remained subdued for the majority of 2021.

Revenue from hotel operations also decreased by 27 percent to P146 million in 2021 owing to travel restrictions. 

SOURCE:Bilyonaryo

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Andrew Tan’s Megaworld swings to positive growth, earns P13.4B profit in 2021

Megaworld Corp., the property arm of bilyonaryo Andrew Tan, returned to familiar ground with a 36 percent jump in profit last year.

In a statement, Megaworld said net earnings rose to P13.4 billion last year from P9.9 billion in 2020 as all core businesses registered double digit growth.

Consolidated revenues grew 17 percent to P50.8 billion on strong sales. Real estate sales climbed by 25 percent to P31.1 billion as construction activities picked up during the year.

Reservation sales increased by 17 percent to P80 billion,.

“There has been a huge demand for titled lots, from both our residential and commercial offerings last year. We can see this trend to continue even this year,” said Kevin L. Tan, chief strategy officer at Megaworld.

The office segment saw rental income soar to an all-time high of P11.1 billion, closing around 236,000 square meters of new and renewal transactions.

Megaworld Lifestyle Malls, on the other hand, continued to feel the pandemic’s pinch as rental income fell 10 percent to P2.3 billion amid the lockdowns imposed during the year to curb the virus.

Meanwhile, revenues from the hotel business grew 30 percent to P1.9 billion due to the consistent performance of the company’s in-city hotels and the opening of Kingsford Hotel in the company’s Westside City township within the Entertainment City.

“In 2021, we shifted gears from pandemic management to restarting our growth trajectory, and our initiatives on this front have begun to bear fruit. As our numbers have shown, all our business segments registered significant improvements, even as we continue to provide assistance to ensure the recovery of our various stakeholders,” Tan said.

SOURCE: Bilyonaryo

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Andrew Tan’s MREIT books P2B profit in first 6 months of operations

 Megaworld-backed MREIT Inc. posted a net income of P2 billion in the six months ending December last year, boosted by a fair value gain on investment properties worth P702 million.

Revenues rose five percent to P1.5 billion.

Given its robust performance, the company has approved the declaration of dividends amounting to 24 centavos per share for the fourth quarter of 2021. This brings the total dividends declared by MREIT last year to 48 centavos per share.

The dividends shall be payable on March 31 to shareholders on record as of March 18.

“We are pleased with the accomplishments of MREIT to date and are thankful for all the support that we have received from our shareholders, as evidenced by the strong performance of MREIT shares in the bourse. We aim to build on this momentum as we embark on our expanded acquisition plan this year,” said Kevin L. Tan, president and CEO of MREIT.

MREIT is looking to acquire up to P20 billion worth of office assets, which will expand its gross leasable area to around 500,000 square meters by the end of 2023 and achieve an annual total shareholder return of at least 10 percent via organic growth and new acquisitions.

“We also want to look at opportunities to expand our portfolio footprint to Megaworld’s other townships,” Tan said.

MREIT plans to eventually expand its portfolio GLA to one million sqm before the end of the decade as part of its goal to be one of the largest office REITs in Southeast Asia.

SOURCE: Bilyonaryo

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Kevin Tan bulks up MREIT’s portfolio with the infusion of P20B worth of office assets

 The real estate investment trust (REIT) unit of township developer Megaworld will see its portfolio expand to P78.5 billion this year with the infusion of P20 billion worth of office assets.

MREIT president Kevin Tan said these properties, which will come from various Megaworld townships across the country, have a multinational tenant base which include large financial, healthcare, technology and consulting firms.

“MREIT is looking to surpass its target for 2022 in terms of asset injection…We earlier announced an additional 44,300 square meters by end of the year, but we are working to further bulk it up with more assets as we continuously look for ways to increase dividend yields for our shareholders,” said Tan.

SOURCE: Bilyonaryo

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Andrew Tan strikes deal with Boy Reyno to buy P1.9B Manila Jockey lot

Bilyonaryo Andrew Tan is further expanding Megaworld Corp.’s presence in Manila with the planned purchase of a 2.2 hectare property owned by Manila Jockey Club Inc. of the Reyno family for P1.89 billion.

In separate filings with the stock exchange, Megaworld and Manila Jockey said they signed a memorandum of agreement with respect to the sale of certain parcels of land in Sta. Cruz, Manila.

Manila Jockey said the transaction is subject to the submission of closing documents

The property, which forms part of the historic 16-hectare San Lazaro Tourism and Business Park in the northern part of Manila, is seen to boost Megaworld’s revenue stream and client base.

“Currently, our big projects in the City of Manila are concentrated in Binondo district, particularly within our Lucky Chinatown project where we have a lifestyle mall, condominium towers, a cultural museum, and a hotel. When we finalize the purchase of this land in San Lazaro, this will surely be part of our township portfolio expansion in Metro Manila,” said Kevin L. Tan, chief strategy officer at Megaworld.

Megaworld has around 300 hectares of land bank across the National Capital Region covering nine integrated urban townships and lifestyle estates in Quezon City, Taguig City, Pasay City, Parañaque City, Las Piñas City, Pasig City, and the City of Manila.

In total, the company has close to 5,000 hectares of land bank across the Philippines.

SOURCE: Bilyonaryo

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Converge, Wilcon, Globe rule index stocks in 2021; investors lose the most in JG Summit, LT Group, Megaworld

 Investors who stuck with bilyonaryo Dennis Anthony Uy had the biggest payoff in 2021.

The Pampanga businessman’s Converge ICT Solutions (CNVRG) was the best performing stock with the only triple-digit growth in the 30-member Philippine Stock Exchange Index last year.

CNVRG, the country’s leading pure fiber data and internet service provider, soared 114 percent year on year to P31.90 in 2021. CNVRG hit a 52-week high of P45.40 or triple its opening day price of P15.22 in October 2020.

William Belo’s big-box retailer Wilcon (WLCON) Depot was the second biggest winner with an 80.5 percent gain to P30.50. WLCON’s sales more than doubled to P1.9 billion in the first nine months of 2021 with Filipinos taking up more renovation projects as they spent more time at home due to the pandemic.

The Ayalas’ Globe Telecom (GLO) jumped 63.6 percent to P3,322, peaking at an all-time high of P3,670. Investors scrambled to ride on GLO after its massively popular GCash reached double unicorn status or $2 billion in valuation.

The Ayalas’ power unit, AC Energy, was also the fifth-best performer with a 36 percent gain to P11.

Another big advancer is Ricky Razon’s International Container Terminal Services Inc. (ICT) which climbed 62 percent to P200. ICT rocketed to a record high of P213.60 as profits swelled 73 percent to $316 million in the first nine months.

ICT’s performance more than made up for the weak performance of Bloomberry Resorts, operator of the pandemic-stricken Solaire Hotel and Casino, which dropped 22 percent to P6.30, No. 4 on the top index decliners.

Rounding up the Top 10 index winners of 2021 are:

6) PLDT up 35 percent
7) Aboitiz Equity Ventures up 15 percent
8) Metropolitan Bank & Trust Co. up 13 percent
9) Bank of the Philippine Islands up 13 percent
10) BDO Unibank up 13 percent

But these gains were not enough to carry the PSE Index which slipped .24 percent to 7,122 in 2021.

The index, which fluctuated between 6,080 and 7,475 in 2021, lost three percent on its last trading day with the arrival of the Omicron variant in the country.

The biggest loser among index stocks was Lance Gokongwei’s JG Summit which plunged 26 percent to P53. The conglomerate’s profits were dragged by the heavy losses of its budget airline, Cebu Pacific.

Gokongwei’s Universal Robina Corp. (URC) was also the fifth worst-performing stock of 2021. URC lost 16 percent to P128 per share.

The lingering travails of the travel business also weighed down Lucio Tan’s LT Group which lost 24 percent to P9.90, the second worst-performing stock of 2021. Tan’s Philippine Airlines filed for bankruptcy protection in the United States

Andrew Tan’s Megaworld was third on the losers’ list with a 23 percent drop to P3.15.

Rounding up the Top 10 index losers of 2021 are:

6) SM Prime Holdings down 12 percent
7) Security Bank down 11 percent
8) San Miguel Corp. down 10 percent
9) Ayala Land Inc. down 10 percent
10) SM Investments Corp. down 10 percent

SOURCE: Bilyonaryo

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Andrew Tan’s MREIT to invest in townships, logistics

The real estate investment trust (REIT) of bilyonaryo Andrew Tan’s Megaworld Corp. is diversifying its portfolio to include townships as well as industrial and logistics properties.

In its three-year growth plan submitted to securities regulators, MREIT said it was looking at investing in other real property sectors that meet its investment criteria for Grade A, centrally-located, stably occupied, and income-producing properties.

MREIT aims to deliver an annual total shareholder return of at least 10 percent through organic growth and new acquisitions.

In selecting assets for future investments, MREIT said the potential property should be located in a prime location in either Metro Manila or key provinces in the Philippines.

Acquisitions will be funded either through debt or equity or a combination of both.

The company currently carries minimal debt at 12.4 percent of deposited properties, well below the aggregate leverage limit of 35 percent which may be further increased to 70 percent for REIT companies that have a publicly disclosed investment grade credit rating by a duly accredited or internationally recognized rating agency.

MREIT’s property portfolio is currently valued at P58.5 billion with the infusion of four prime office buildings in Philippine Economic Zone Authority-registered zones. These include Two Techno Place, Three Techno Place and One Global Center, which are all located in Iloilo Business Park, and World Finance Plaza in Mckinley Hill in Fort Bonifacio.

 SOURCE: Bilyonaryo

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Andrew Tan prepping for tourism’s rebound: Megaworld selling P5B worth of boutique hotel, commercial lots in Palawan

Megaworld is eyeing to generate around P5 billion from the sale of lots in its planned Mercato Shophouse and Porto Hotel District in San Vicente, Palawan.

Located within Megaworld’s P40 billion eco-tourism township in the Paragua Coastown, the master-planned Mercato Shophouse District and the Porto Hotel District is offering to the public 240 lots ranging from 250 to 599 square meters for shophouses, and 450 to 1,199 sqm for boutique hotels.

Both Mercato Shophouse District and Porto Hotel District are interconnected to each other, providing convenient walkability through expansive sidewalks and bridges.

“Our eco-tourism township offers businesses and entrepreneurs such as hotel owners, restaurateurs, coffee shop and bar operators, and retail shop owners to own land in San Vicente, particularly inside our master-planned beachside development,” said JR Abusta, head of sales and marketing at Megaworld Palawan.

Abusta said the district would have close access to the coastline of Long Beach Area of San Vicente, which has been designated as a Tourism Enterprise Zone (TEZ) of the Tourism Infrastructure and
Enterprise Zone Authority (TIEZA).

TIEZA’s Tourism Enterprise Zones have special incentives for tourism-related businesses such as tax holidays.

Among the first developments in the area include medical and wellness facilities, church, and other leisure and institutional amenities.

“We will definitely have unique residential and recreational offerings inside Paragua Coastown as well. What we are building here will hopefully help San Vicente become the most popular eco-
tourism spot in Palawan and the entire country. But of course, we give utmost importance to sustainable real estate because this is what everyone will be looking for when they decide to invest in Palawan,” said Abustan.

SOURCE: Bilyonaryo

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Kevin Tan pleased with Megaworld’s strong Q3 showing

Benefiting from the resurgence in demand for residential properties, Megaworld saw its third quarter net income surge 57% to P3.2 billion due to the easing of coronavirus restrictions.

This brings the company’s first nine months profit to P8.2 billion or an increase of 10 percent from the same period last year.

Consolidated revenues climbed by 50% to P14.5 billion in the third quarter, bringing Megaworld’s total revenues to P36.9 billion in the nine months to September.

“The recovery momentum has started to pick up and we hope that the lowering of the alert levels especially in Metro Manila will continue until the year-end. As more people safely go out and enjoy the normal life, the better for business and our economy as a whole,” said Kevin L. Tan, chief strategy officer of Megaworld.

Real estate sales led the recovery, more than doubling to P9.6 billion during the quarter amid the expansion in construction activities. The nine-month figure reached P23.1 billion, up 21 percent year on year.

Reservation sales grew 35 percent to P17.1 billion during the third quarter.

The hotels & resorts segment staged a strong recovery during the quarter as revenues grew 121 percent to P552 million with the opening of Kingsford Hotel in the company’s Westside City township along Manila Bay

Megaworld Premier Offices, meanwhile, saw flat rental earnings in the third quarter at P2.9 billion.

Its Lifestyle Malls, on the other hand, reported a 16 percent jump in rental income to P469 million.

SOURCE: Bilyonaryo

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Kevin Tan pleased with Megaworld’s strong Q3 showing

Benefiting from the resurgence in demand for residential properties, Megaworld saw its third quarter net income surge 57% to P3.2 billion due to the easing of coronavirus restrictions.

This brings the company’s first nine months profit to P8.2 billion or an increase of 10 percent from the same period last year.

Consolidated revenues climbed by 50% to P14.5 billion in the third quarter, bringing Megaworld’s total revenues to P36.9 billion in the nine months to September.

“The recovery momentum has started to pick up and we hope that the lowering of the alert levels especially in Metro Manila will continue until the year-end. As more people safely go out and enjoy the normal life, the better for business and our economy as a whole,” said Kevin L. Tan, chief strategy officer of Megaworld.

Real estate sales led the recovery, more than doubling to P9.6 billion during the quarter amid the expansion in construction activities. The nine-month figure reached P23.1 billion, up 21 percent year on year.

Reservation sales grew 35 percent to P17.1 billion during the third quarter.

The hotels & resorts segment staged a strong recovery during the quarter as revenues grew 121 percent to P552 million with the opening of Kingsford Hotel in the company’s Westside City township along Manila Bay.

Megaworld Premier Offices, meanwhile, saw flat rental earnings in the third quarter at P2.9 billion.

Its Lifestyle Malls, on the other hand, reported a 16 percent jump in rental income to P469 million.

 SOURCE: Bilyonaryo

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Andrew Tan’s office buildings see upswing in demand in first 9 months

As cities spring back to life following the easing of movement restrictions, bilyonaryo Andrew Tan’s property arm Megaworld Corp. has seen a surge in office takeups.

Megaworld’s office take-up accelerated in the first nine months of the year to 214,000 square meters or 12 percent above the company’s conservative target of 191,000 sqm.

Around 79 percent of the new lease contracts booked came from the IT-BPM (information technology and business process management) sector.

Megaworld said about 36 percent of the new signups was mostly in Uptown Bonifacio, McKinley Hill, Southwoods City and Davao Park District.

“It is exciting to note that several tenants opted to retain their spaces, and even expanded during the pandemic. The demand still remains despite earlier speculations that the work-from-home arrangements will lead to massive vacancies,” said Roland Tiongson, first vice president at Megaworld Premier Offices.

“With the eased restrictions and the re-opening of our borders for international travelers, we are optimistic that we will be able to achieve a better full-year performance of our office leasing business this year,” Tiongson added.

Megaworld claims to be the largest office landlord in the country with around 1.4 million square meters of leasable office space inventory.

It has PEZA-accredited office properties in its various integrated urban townships nationwide such as Eastwood City in Quezon City; Uptown Bonifacio, McKinley Hill, and McKinley West in Taguig City; Iloilo Business Park in Iloilo City; Davao Park District in Lanang, Davao City; Southwoods City in Biñan, Laguna; The Mactan Newtown in Cebu and Arcovia City in Pasig City.

SOURCE: Bilyonaryo

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MREIT delivers best first-day returns among REITs

Megaworld-sponsored MREIT Inc. had a solid stock market debut last week, closing nearly four percent higher than its initial offer price, making it the most successful listing of a real estate investment trust on the Philippine Stock Exchange.

MREIT has so far delivered the best debut performance among REITs. On its first trading day, the stock rose 3.73 percent or 60 centavos to finish at P16.70 on volume of 33.478 million shares valued at P558.5 million. It even reached a high of P17.16 intraday.

Ayala Land Inc.’s AREIT – the pioneer REIT in the Philppines – opened at P27 per share or the same as its IPO price but fell 7.8 percent to P24.90 apiece.

DoubleDragon Properties Corp.’s DDMPR, the second REIT to list on the PSE, peaked at P2.40 before closing at its listing price of P2.25 apiece.

Gotianun-led FILREIT edged up slightly at P7.02 from its IPO price of P7.

The Gokongwei family’s RL Commercial REIT, which is backed by Robinsons Land Corp., went as high as P6.55 before closing at P6.46, slightly higher than its initial offer price of P6.45 per share.

SOURCE: Bilyonaryo

 

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Megaworld to develop P40B eco-tourism estate in Palawan

Betting big on tourism regaining its footing, bilyonaryo Andrew Tan’s Megaworld Corp. is spending P40 billion in the next 10 to 15 years to transform 462 hectares of beachfront and inland properties in San Vicente, Palawan into an ecotourism township.

Megaworld’s 27th township, Paragua Coastown will be an integrated resort community with hotels and resorts, health and wellness sanctuaries,cultural center, educational institutions, a boutique hotel district, a shophouse district, as well as residential developments such as private villas, serviced apartments, themed residential villages, and a mangrove reserve park.

It will feature some of the most beautiful beaches along the coastline of San Vicente, including Port Barton, one of the most famous tourist attractions of the town known for its 22 small islands.

San Vicente has the longest white-sand beach in the Philippines, and the second longest beach in Southeast Asia, which is called the Long Beach, covering almost 15-kilometers of coastline – three times longer than Boracay.

The masterplanned development is strategically located within a few minutes away from the San Vicente Airport, which serves regular flights to and from Manila and Clark.

“As we grow our sustainable developments portfolio, this new township in the beautiful town of San Vicente in Palawan will showcase the best of sustainable tourism and green living. While we transform it into a world-class development, we also commit to the preservation of the island’s biodiversity,” said Kevin L. Tan, chief strategy officer at Megaworld.

The first area to be developed is around 83-hectares of land in Kemdeng, which has its own beach line.

“More than just sustainable tourism, our vision for this expansive Palawan property is to provide an opportunity to those who want the island-life to live and even raise their families here. Aside from the preserved natural surroundings of the beach, mountains and cliffs of San Vicente, we will also provide the facilities and amenities for holistic wellness for our future residents,” said Tan.

SOURCE: Bilyonaryo

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Overwhelming response: MREIT IPO attracts steady stream of investors

The initial public offering of Megaworld-sponsored MREIT Inc. is shaping up to be a big success.
In an interview with ANC, BDO Capital president Ed Francisco said the IPO has received an overwhelming response from some of the world’s largest fund managers and high net worth individuals.

In an interview with ANC, BDO Capital president Ed Francisco said the IPO has received an overwhelming response from some of the world’s largest fund managers and high net worth individuals.

Francisco said the decision to downsize the offering and IPO price was warmly welcomed by investors as orders kept pouring in. The IPO is already two times oversubscribed and could generate even more investor demand.

“We spoke to the big funds, and basically, the big funds and high net worth investors of these funds were the ones who ordered. No final numbers yet. But, we were looking at least in the foreign institutional investors and foreign domestic investors, so that was a very good feedback that we got. We’re very happy.

“And that’s why we’re bidding the price down and the effective price also went down. So that’s why there’s that interest and we’re pleasantly surprised that there’s more people coming out saying they will wait but now that they found out the rate and they heard about the upcoming news announcements of Kevin Tan they’re excited and they’re trying to get more shares,” Francisco said.

A special dividend awaits investors, he said.

“If you buy MREIT, in a month there will be a special dividend already . There’s a cash return already for you,” Francisco said.

Francisco noted MREIT’s dominant position in the office space that will allow it to generate multi-year growth.

He said the real estate investment trust of the country’s leading office landlord, Megaworld, has a superior portfolio free of Philippine Offshore Gaming Operators (POGO).

Most of its office properties are Philippine Economic Zone Authority-accredited cyber zones and are occupied by high quality business process outsourcing companies and multinational firms, making MREIT attractive to income hunters.

“Megaworld Group has no POGOs, and MREIT has no POGOs. That’s what differentiates it with the other REITs in the market. Again, they are PEZA-registered and that gives them that unique superior ability,” Francisco said.

Tan, president of MREIT, has committed to boost MREIT’s leasable portfolio to one million square meters in the next five to 10 years in line with its goal to be the country’s largest and fastest growing REIT in Southeast Asia.

Next year, Megaworld is infusing an additional 100,000 square meters of prime office assets to boost its portfolio to around 324,000 sqm by end-2022.

MREITs initial portfolio of 224,431 sqm consists of 10 prime office buildings in three of Megaworld’s most established township locations. These include 1800 Eastwood Avenue, 1880 East Avenue, E-commerce Plaza, One World Square, Two World Square, Three World Square, 8/10 Upper McKinley Building, 18/20 Upper McKinley Building, One Techno Place Iloilo, Richmonde Tower and Richmonde Hotel Iloilo.

“We only see this as the beginning of a very long growth runway. We thank investors for their trust and confidence in supporting our IPO. We are excited about the opportunity to grow and create value for our sponsor, our investors and for the country”, said Tan.

SOURCE: Bilyonaryo

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REIT dividend yield to continue luring investors

HAVING an attractive dividend yield will continue to lure investors to real estate investment trust (REIT) listings despite cautious sentiment amid uncertainty brought by the coronavirus disease 2019 (COVID-19) pandemic, analysts said.

MREIT, Inc., the REIT sponsored by Megaworld Corp., said its final offer will comprise 844.30 million common shares and an overallotment option of up to 105.54 million shares. This is down from its initial plan to offer 1.08 billion shares with an overallotment of up to 161.7 million shares.

“The reduction of offer shares tells us that the demand for these office leasing REITs may have started to decline. The last four REIT listings that happened over the span of 12 months [have] given the market all the exposure that it wants in this sector,” AAA Southeast Equities, Inc. Research Head Christopher John Mangun said in a text message on Friday.

Ayala-led AREIT, Inc. is the Philippine Stock Exchange’s (PSE) first REIT listing, which made its market debut in August last year. DoubleDragon Properties Corp.’s DDMPR, Inc. led this year’s offers in March, followed by Filinvest Land, Inc.’s Filinvest REIT Corp. last month.

Meanwhile, the REIT unit sponsored by Robinsons Land Corp., RL Commercial REIT, Inc., is slated to list on the PSE on Tuesday, Sept. 14.

“Investors may want to see how [MREIT] performs in the next few quarters before increasing their positions in this area, since the assets between the REITs are similar and do not have any major advantages against the other,” Mr. Mangun said.

Meanwhile, MREIT also set its final initial public offering (IPO) price to P16.10 apiece, 27% lower than the P22 each maximum offer price it set on its prospectus.

“Given the current state of the economy as well as the uncertainty over how the COVID-19 pandemic will unfold in the coming months, the IPO’s final offer price may encourage more investors to participate in the offer given the higher dividend yield,” Timson Securities, Inc. Trader Darren Blaine T. Pangan said in a Viber message on Saturday.

MREIT President Kevin Andrew L. Tan said in an e-mailed statement on Friday that its IPO was priced “to provide more upside to IPO investors,” who were dubbed as the company’s “long-term partners.”

Its projected dividend yield is at 5.65% for 2022 and is said to be around 6.1% for 2023. 

“Recall that this may potentially be higher according to MREIT’s management as occupancy as of August was already at 100%,” Papa Securities Corp. Equities Strategist Manny P. Cruz said in a text message on Friday.

“Our view is that the offering is attractive given the yield that is slightly higher than AREIT [at] 5.4%,” he added.

Timson Securities’ Mr. Pangan said MREIT currently offers “much more attractive yields,” while AAA Southeast Equities’ Mr. Mangun said it may “potentially become the highest-paying REIT on the PSE.”

“However, these projections are solely based on their prospectus as no earnings reports for fiscal year 2022, which just started last July 1, 2021, have been reported,” Mr. Mangun added.

MREIT may raise up to P15.29 billion in proceeds, should the overallotment option be exercised. This will be used to fund the development of 21 Megaworld projects across 11 of its townships in the country within the next 12 months. This includes 15 office developments, five lifestyle malls, and one hotel.

“[Megaworld] will be receiving more proceeds once it completes the impending cash injection of three buildings into MREIT, which is slated to be completed by early 2022,” Mr. Tan said.

MREIT was said to have attracted strong demand from institutional investors both here and abroad.

“At the current issue size, the institutional tranche was close to two times oversubscribed, which bodes well for aftermarket performance,” MREIT’s Mr. Tan said. 

“Local demand [is] expected to build up further as retail [investors are] waiting for final price,” BDO Capital & Investment Corp. President Eduardo V. Francisco said in a text message on Friday.

Post-IPO, Megaworld will have a 62.5% stake “to capture more near-term and long-term valuation upsides” as its REIT unit continues to grow along with the country’s REIT industry.

“MREIT expects both its market cap and float to grow over time as it successfully executes on its aggressive growth trajectory,” Mr. Tan said.

SOURCE: BusinessWorld

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Kevin Tan: MREIT IPO’s institutional tranche 2x oversubscribed

 

The institutional tranche of MREIT Corp.’s initial public offering is twice oversubscribed, reflecting healthy investor interest for the issue backed by the country’s biggest office landlord Megaworld Corp.

MREIT president Kevin Tan said the company downsized its IPO and priced it at P16.10 per share, below the maximum proposed price of P22 in its desire to please investors.

“The company has decided to price the deal at an attractive level to provide more upside to IPO investors who will be its long-term partners in this new journey. At this IPO price, MREIT will be offering investors an attractive dividend yield of 5.65 percent to be distributed quarterly, and at the same time, we will be giving them exposure to high quality, fast-growing portfolio of assets,” said Tan, who is also chief strategy officer at Megaworld.

“If we exercised full option, it would have still been oversubscribed 1.5x. At this current size we are 2x,” he pointed out.

From the original plan of 1.078 billion shares, MREIT’s offer size has been whittled down to 949.84 million shares including an overallotment option of up to 105.54 million shares.

At its new price, MREIT’s maiden share sale could generate up to P15.3 billion, enough to support Megaworld’s 21 projects across the country in the next 12 months.

MREIT owns 10 office buildings catering to outsourcing firms and a hotel with a gross leasable area of nearly 225,000 square meters (2.4 million square feet), equivalent to 31 soccer pitches. It will add five more income-generating assets totaling 100,000 sqm in 2022, which is seen to boost the company’s dividends to shareholders.

“MREIT, being Megaworld’s flagship REIT, is being structured to deliver fast growth and strong aftermarket performance,” Tan said.

Tan said Megaworld would maintain a 62.5% stake in MREIT “to capture more near term and long term valuation upsides for its shareholders as MREIT actively grows its portfolio with the maturation of the overall REIT industry in the Philippines.”

SOURCE: Bilyonaryo

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Frederick Go’s RLC still biggest REIT IPO after Megaworld lowers MREIT offer

Megaworld-sponsored MREIT Inc. cut the size of its initial public offering by nearly a quarter and priced it below the P22 maximum price indicated in its IPO filing.

Megaworld-sponsored MREIT Inc. cut the size of its initial public offering by nearly a quarter and priced it below the P22 maximum price indicated in its IPO filing.

In a disclosure to the stock exchange, Megaworld said MREIT priced its IPO at P16.10 per share to raise as much as P15.3 billion or just 56 percent of its initial target of P27.3 billion.

This is 53 percent lower than the P23.5 billion offer of Robinsons Land Corp.’s REIT, the largest so far in terms of market capitalization, portfolio valuation and asset size.

MREIT will now offer up to 949.84 million shares to the public including an over allotment option of up to 105.54 million shares.

It will be the fifth REIT to list on the exchange after AREIT, DDMP REIT, Filinvest REIT and RL Commercial REIT.

The offer period will run from Sept. 14 to 20 while the company’s shares will start trading on Sept. 30.

SOURCE: Bilyonaryo

 

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GERI zooms up nearly 50% as Andrew Tan forges ahead with plan to build ‘tiny’ casino in Boracay

Global-Estate Resorts, Inc. (GERI) nearly hit the ceiling as local investors placed their bets on bilyonaryo Andrew Tan’s plan to put up a casino in its Boracay Newcoast estate.

GERI jumped 46 percent to P1.33, its highest in two years, on P80 million turnover.

Investors were excited by Tan’s announcement that GERI would proceed with its long-delayed casino project in Boracay a day after President Rodrigo Duterte lifted the ban on the island.

“We already have several hotels there and we are still building more. There is also a golf course (Fairways & Bluewater), the only one in the entire Boracay Island. We are very hopeful that the tourism industry in this island will recover fast after the pandemic,” said Tan in a statement.

But a GERI insider clarified that the planned casino would occupy less than a hectare of the 150-hectare estate and it would not even be its main attraction.

Newcoast has two hotels in operation – Savoy and Belmont – and is building a new one, Chancellor.

GERI is developing an exclusive residential village and commercial and retail districts in the township project. It has allocated 60 percent of the estate for green and open spaces.

GERI sold P4.22 billion worth of Newcoast Village lots and condominium units in 2020.

 SOURCE:Bilyonaryo

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