PROPERTY DEVELOPER Megaworld Corp. will start Friday an offering of five-year retail bonds carrying a coupon rate of 8.46 percent per annum.

In a disclosure to the Philippine Stock Exchange Thursday, Megaworld said it had signed an agreement with joint lead managers and bookrunners BDO Capital & Investment Corp. and HSBC Ltd. that finalized the terms of conditions of the bonds due on May 18, 2015. The total principal amount of the fixed-rate bonds is P5 billion.

The Securities and Exchange Commission has approved the offering, which is targeted to start today and will run until Nov. 11 or Wednesday next week.

Local credit watchdog Credit Rating and Investor Services Philippines Inc. (CRISP) has assigned an “AAA” rating to the proposed bond issuance. This is CRISP’s highest rating, which reflects the issuing company’s very strong capacity to repay obligations.

The amount to be generated from the offering will be used for the development of its new 8.38-hectare mixed-use venture in North Bonifacio, Taguig.

Megaworld has committed to invest at least P15.6 billion over the next 20 years to develop the North Bonifacio property, located in the northern district of Fort Bonifacio and extending all the way to Kalayaan Avenue. The property is near the school zone where the British, Japanese and American international schools and various local schools are located.

The company was recently awarded the right to develop the prime property as a joint venture partner of the state-owned Bases Conversion Development Authority (BCDA).

The BCDA will be paid an upfront cash amount of P1.06 billion plus P306.62 million in annual revenues for the next 12 years.