Strong rentals boost Q1 profit of Ayala’s REIT

Real estate giant Ayala Land Inc.’s real estate investment trust (REIT) arm, AREIT Inc., grew profits by nearly 60 percent in the first quarter of the year amid robust rentals in its expanding property portfolio.

This brings the REIT firm’s year-on-year net income from January to March to P796 million, which did not include the profit boost coming from an accounting revaluation of property assets, AREIT emphasized in a statement.

AREIT said leases at its properties remained robust with an average occupancy rate of 97 percent and a collection rate of 98 percent. This reflected “stable and high-quality tenancy” within its buildings.

Total revenues thus increased 66 percent to P1.2 billion during the first quarter. The company’s earnings before interest, taxes, depreciation and amortization also jumped 58 percent to P843 million during the period.

AREIT continues to expand its assets via REIT sponsor Ayala Land.

Shareholders, during its recent stockholders’ meeting, approved an P11.2-billion property for share swap involving six office buildings in Cebu.

AREIT said this would expand its gross leasable area to 673,000 square meters.

This also brings assets under management to P64 billion, more than double the size from its initial public offering (IPO) during the height of the COVID-19 pandemic almost two years ago.

“With this infusion, AREIT’s dividend per share is projected to increase further,” the company said in its statement.

Its full-year dividends last year reached P1.77 per share, up 34 percent from 2020. AREIT said this was also above initial dividend projections made during its IPO.

AREIT was the first of a wave of REIT listings after the Department of Finance, under the Duterte administration, resolved taxation and public ownership roadblocks put up by the previous Aquino government.

There are five other REIT companies listed on the Philippine Stock Exchange (PSE). These were Citicore Energy REIT Corp., DDMP REIT Inc., Filinvest REIT Corp., MREIT Inc. and RL Commercial REIT inc.

Billionaire Manuel Villar Jr.’s VistaREIT is set to launch a P9-billion offer later month. In its latest financial briefing, the PSE indicated that the billionaire Sy family’s SM Prime Holdings is planning a P36-billion REIT offer. INQ