First REIT listing arrives, but stumbles in debut

Ayala Land-backed AREIT Inc. made its trading debut on the Philippine Stock Exchange (PSE) on Thursday, completing the country’s first ever real estate investment trust (REIT) listing.

AREIT opened at P27 per share—the same as its offer price during its initial public offering (IPO)—but ended the session lower by almost 7.8 percent to P24.90 per share.

The drop came as a surprise given the PSE Index’s strong rebound above the 6,000 level on Thursday.

COL Financial research head April Lee Tan said this was an opportunity for investors see­king dividend-paying stocks.

She said at the current price, AREIT would pay a yield of 5.3 percent for 2020 and 6.3 percent for 2021.

“Outlook for offices remain favorable because of demand for BPOs (business process outsourcing),” Tan told the Inquirer.

AREIT, whose IPO was valued at a maximum of P13.6 billion, will hold three property assets.

The largest of these is the Ayala North Exchange, which has two office towers that stand on top of a three-story retail podium, as well as a collection of 293 serviced apartment units branded as Seda Residences Makati.

The first tower is a 12-story headquarter-type office while the second tower is a 20-story Philippine Economic Zone Authority (Peza)-accredited BPO office. This asset has a total gross leasable area (GLA) of 95,554.35 square meters.

Another asset is Solaris One, a 24-story Grade A Peza-accre­dited commercial building on Dela Rosa Street, Legaspi Village, which has 46,767.96 sqm of GLA.

Finally, there is McKinley Exchange, a five-story Grade A, Peza-accredited mixed-use development on McKinley Road corner Edsa Makati, which has 10,687.50 sqm of GLA, of which 9,633.32 sqm are designated for commercial office leasing.

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

BPI Capital, PNB Capital and Investment Corp. and SB Capital Investment Corp., are the underwriters for the domestic tranche. —MIGUEL R. CAMUS