Filtered By: Money
Money

DOF chief: PHL's 1st REIT listing strong 'vote of confidence' despite pandemic


Finance Secretary Carlos Dominguez III lauded the listing of the Philippines’ first Real Estate Investment Trust (REIT) listing by the Ayala Land-backed AREIT Inc. as a sign of the economy and the domestic market’s resilience despite the challenges brought about by the COVID-19 pandemic.

“This public offering is a strong vote of confidence in our good economic prospects and in the resiliency of many of our industry sectors, some of which will be occupants of Ayala Land Inc. (ALI)'s REIT properties,” Dominguez in his videotaped message during the initial public offering (IPO) and listing of AREIT on the Philippine Stock Exchange (PSE).

"It shares in the optimism that, notwithstanding the global economic downturn today, the Philippine economy has strong fundamentals to rise quickly from the devastation brought about by the global health emergency," he said.

 

 

AREIT Inc. priced its IPO at P27.00 per share. Its offer consists of 47.864 million primary shares and 409.019 million secondary shares, with an overallotment option of 45.688 million secondary shares.

 

AREIT raised P13.6 billion from the IPO, following the close of the offer period on August 3.

Following the conclusion of the offer, Ayala Land will continue to hold at least 51% of AREIT. The post-offer market capitalization will be P27.7 billion, while the public float of AREIT will fall between 44.5% and 49.0%, subject to the exercise of the over-allocation option.

Non-Filipino investors account for 15.7 % of total outstanding shares.

During its market debut, AREIT opened flat at P27.00 apiece. Its share price closed 7.78% lower at P24.90.

Sought for comment, Philstocks Financial senior equity analyst Piper Tan said investors are on a “buy and hold” mode for AREIT since earnings will be derived through dividends and less on the trading side.

Nevertheless, Dominguez said he is optimistic that AREIT’s public offering and listing will encourage more companies to form REITs that would “provide attractive and dependable investment opportunities for the average Filipino.”

“A REIT public offering not only signals that there is strong confidence in existing real properties, but that the company sees new opportunities for expansion with the proceeds of the offering,” he said.

The country’s first REIT listing came more than a decade since the REIT Act was passed in 2009. The law allowed companies to list their real property assets on the Philippine Stock Exchange as a new vehicle to raise funds for other investments and expansion initiatives.

“Today is a momentous event. More than a decade since the enactment of the REIT Law or the Real Estate Investment Trust Act, we will witness the Philippines’ first REIT listing through Ayala Land’s public offering,” Dominguez said. 

Securities and Exchange Commission (SEC) chairman Emilio Aquino and PSE president Ramon Monzon were among those present at the event marking AREIT’s listing in the local bourse.

Ayala Land chairman Fernando Zobel de Ayala attended via video conference app Zoom.

“REITs will help boost our 'Build, Build, Build' program, given the wide range of real estate property assets it can own. Infrastructure investments will primarily fuel our bounce back plan. With their high multiplier effect, these investments will stimulate demand and create much-needed new jobs and businesses,” Dominguez said. 

BPI Capital Corp. served as the sole global coordinator and joint bookrunner for the IPO while UBS AG Singapore Branch was the sole international bookrunner for the international tranche of the IPO.

BPI Capital Corp., PNB Capital and Investment Corp., and SB Capital Investment Corp. were collectively underwriters for the domestic tranche. BPI Stock Transfer Office served as the receiving agent and stock transfer agent. —LBG/BM, GMA News

LOADING CONTENT