DoubleDragon plans P9.7-B bond issue

MANILA, Philippines - DoubleDragon Properties Corp. (DoubleDragon) will issue a second tranche of its  fixed rate retail bonds of up to P9.7 billion comprising of a base offer of P6.5 billion with an oversubscription of P3.2 billion.

The proposed issuance forms part of the P15 billion retail bonds previously approved by the Securities and Exchange Commission under its shelf registration program.

Proceeds will be used to finance the capital expenditures of DoubleDragon’s core recurring revenue-focused projects which are CityMalls, DD Meridian Park and Jollibee Tower.

Meanwhile, the remaining P9.7 billion in fixed rate retail bonds under shelf registration previously approved by the SEC is intended to fully fund the remaining capex requirements for the completion of the planned one million square meters of leasable space DoubleDragon anticipates to have in its portfolio by 2020.

“In the next three months, we are set to open 10 more CityMalls across the country and we expect to have at least 30 operational CityMalls by the end of the year, making CityMall the dominant community mall player in the Philippines,” said Edgar “Injap” Sia II, chairman and CEO of DoubleDragon.

Sia said the first phase of the DoubleDragon Plaza at DD Meridian Park, its flagship project, is also set to be completed ahead of schedule within the last quarter of this year.

“To date, 53,800 sqm of leasable space within the four towers of DoubleDragon Plaza has already been taken up,” Sia said.

Double Dragon issued the first tranche last December 2016 amounting to P5.3 billion.

“This offering will be a good chance for retail bond investors to participate in a fresh name like DoubleDragon since we do not expect to be tapping the bond market again anytime soon beyond what is remaining on our shelf registration from last December. Once completely taken up, the proceeds are expected to fully cover our development plans through 2020 for both our office and retail portfolios,” said Hannah Yulo, chief investment officer of DoubleDragon.  

Philippine Rating Services Corp. (PhilRatings), a local debt watcher, maintained an issue credit rating of PRS Aa for the second tranche bond issuance.

Obligations rated PRS Aa are of high quality and are subject to very low credit risk.

This means that, according to PhilRatings, the obligor’s capacity to meet its financial commitment on the obligation is extremely strong.