MREIT to acquire 4 prime assets

MREIT Inc., the real estate investment trust (REIT) company of township developer Megaworld, is finalizing the acquisition of four grade A, Philippine Economic Zone Authority-accredited properties by December this year.

Subject to final approvals, the company is looking to acquire Two Techno Place, Three Techno Place and One Global Center, which are located in Iloilo Business Park, as well as World Finance Plaza in McKinley Hill in Fort Bonifacio, Taguig. The four prime office properties have a combined gross leasable area (GLA) of 55,700 square meters and have an average occupancy rate of 99 percent. Given that MREIT currently has no bank debt on its balance sheet, the acquisition will be funded through borrowings. Once completed, the infusion will increase MREIT’s portfolio GLA by 25 percent to 280,131 sqms from 224,431 sqms.

MREIT’s management vows to ensure that the acquisition will be closed under such terms that will result in enhanced value for its shareholders.

“We remain steadfast in our vision of making MREIT one of the largest office REITs not only in the Philippines, but in the Southeast Asian region as well, and this acquisition is but the first step to realizing the significant growth potential of the company,” says MREIT president and CEO Kevin Andrew Tan.

Tan said they were expecting to close the deal by December this year and that these assets would start to contribute revenues to MREIT starting January 2022. Earlier, the company revealed its plan to infuse about 100,000 sqms of additional office GLA, equivalent to roughly 45 percent of the company’s total portfolio, before the end of 2022. The transaction involving the four prime properties represents the first wave of acquisitions to meet this target.

The properties benefit from a very stable tenant base which is composed mainly of business process outsourcing firms or BPOs. These include renowned companies such as Transcom, WNS and Nearsol.

Even during the pandemic, demand for office space, particularly from BPO locators, in Iloilo Business Park and McKinley Hill remained high. This helped ensure the stability of income generation as well as provide good organic growth for MREIT.