RLC prepares for country’s biggest REIT offering

MANILA, Philippines — Gokongwei-led Robinsons Land Corp. is readying the country’s biggest real estate investment trust (REIT) by portfolio valuation, with a target to list on Sept. 14.

RL Commercial REIT, the fourth REIT to be listed on the Philippine Stock Exchange (PSE), is touted as the biggest REIT to list in the country so far.

“Subject to regulatory approvals and a succesful ipo process, RCR hopes to be the largest in terms of market cap, asset size, and geographical spread. We aim to be the bellwether for the Philippine office REIT market,” RLC president and CEO Frederick Go told The STAR on Monday.

RCR leases to a diversified tenant base a high-quality portfolio of 14 commercial real estate assets spread across the Philippines with gross leasable area of 425,315 square meters.

According to Santos Frank Knight, the value of the REIT’s portfolio was P73.8 billion as of end-June, composed of assets located in central business districts across Metro Manila and in several key cities.

Go said this makes RCR the REIT with the most diverse portfolio in terms of geographical location, which mitigates concentration risk for investors. “We are in nine locations – Makati, Taguig, Quezon City, Pasig, Mandaluyong and Cebu, Tarlac, Naga and Davao,” Go added.

The principal investment mandate of RCR is to focus on investing on a long-term basis in a diversified portfolio of income-producing commercial real estate assets, leased primarily for office purposes, and strategically located in major central business districts and key cities and urban areas across the Philippines.

The tenants are also primarily engaged in providing essential services, such as information technology and business process management (IT-BPM) services, including business process outsourcing (BPO) services, one of the most resilient sectors in the country. This means the portfolio is secure with stable occupancy and income from operations, Go said.

RCR will offer up to 3.3 billion secondary common shares at a price of up to P7.31 per share, with an over-allotment option of up to 305.1 million common shares. The offer shares are currently held by RLC, which could generate up to P26.6 billion in net proceeds should the over-allotment be fully exercised.

New investors will corner 36.67 percent of RCR, while existing shareholders will retain the remaining 63.33 percent should the company exercise the oversubscription option.

Prospects are rosy for RCR, with the Philippine office sector seen staying resilient and even strengthening as companies realize the limitations of work-from-home setups.

“As more people get vaccinated and economic bubbles are formed, we see employees return to office spaces partially or completely. I strongly believe this would be better for businesses in terms of data security and infrastructure. More importantly, we believe that this will be beneficial for the mental health and wellbeing of employees,” said RCR president and CEO, Jericho Go.

A related study released this year by Premier Value Provider Inc. shows that employees working from home are 3.7 times more likely to have critical anxiety levels and six times more likely to suffer from critical depression.

Aside from having a stable and resilient tenant base, RCR properties are also equipped and managed to accommodate the evolving requirements of its tenants and the changing times.

Its office buildings are equipped with hybrid walk-thru metal detectors with temperature scanners, copper films on high touch point surfaces, foot baths, and sanitizing stations within the building premises, among others.

Some of RCR’s buildings are likewise located in RLC’s destination estates, such as Bridgetowne. The master integrated development that spans the borders of Quezon City and Pasig is curated to empower future residents to ‘live, work, play, and inspire,’ in a single urban community.

Go also noted that investing in RCR also means investing in a sustainable future. This is because the office buildings are equipped with eco-friendly and energy-efficient features, and its premium properties in Bridgetowne have achieved LEED certification.

Green design measures of LEED-registered buildings also provide better indoor air quality, promoting a healthier work environment. The improved airflow rate reduces the concentration of airborne viruses and contaminants within leased premises and keeps air fresh and healthy, which help to ensure the well-being of tenants in the LEED certified properties of RCR.