AREIT raises P3 billion from bond issue

MANILA, Philippines — AREIT Inc., the pioneering real estate investment trust (REIT) of Ayala Land Inc., successfully raised P3 billion from the offering of fixed-rate bonds.

Company president and CEO Carol Mills said retail and institutional investors gobbled up the deal, which was 5.6 times oversubscribed.

Securities and Exchange commissioner Ephyro Luis Amatong, who was also present during the virtual listing ceremony of the bonds at the Philippine Dealing and Exchange Corp., said the SEC looks forward to more REITs as well as property and infrastructure firms accessing the capital markets.

AREIT’s P3 billion issuance forms part of a P15 billion debt program filed under shelf registration with the SEC.

The rest of the amount may be issued in one or more tranches within a period of three years.

Proceeds of the first tranche will be used to refinance debt and to partially finance the acquisition of The 30th, a mixed-use commercial development in Pasig City.

The company engaged BPI Capital Corp. and BDO Capital & Investment Corp. as the joint lead underwriters and bookrunners for the transaction.

AREIT is the country’s first REIT. Its sponsor is Ayala Land Inc. (ALI), the property arm of the Ayala Group.

It listed in the Philippine stock market in August last year, jumpstarting the growth of the new asset class which the PSE believes has boosted the local bourse’s competitiveness in the ASEAN region.

In 2020, it declared dividends amounting to P1.32 per share, slightly higher than its REIT plan projection.  For the first quarter this year, AREIT declared dividends of P0.42 per share.

In addition, its board of directors approved the declaration of dividends amounting to P0.44 per share for the second quarter of the year.