Stock Commentary

MREIT declares Q3 cash dividend of P0.246/share

Merkado Barkada
MREIT declares Q3 cash dividend of P0.246/share

MREIT [MREIT 12.20 unch; 94% avgVol] [link], the office leasing REIT arm of Andrew Tan’s real estate empire, declared a Q3/23 dividend of P0.246, payable on December 14 to shareholders of record as of November 20. The dividend is marginally smaller q/q from its Q2/23 dividend of P0.2476. The dividend has an annualized yield of 8.07% based on the previous closing price, which is smaller than MREIT's pre-dividend annualized yield of 8.12%. The total amount of the dividend is P688 million, which is 97% of the P708 million in distributable income that MREIT reported for the quarter. Relative to MREIT's IPO price, the dividend increased MREIT's total stock and dividend return to -10.57%, up from its pre-dividend total return of -12.1%.

MB bottom-line: The associated press release said that MREIT grew its 9M distributable income by 13% y/y, which is good, but the Q3 distributable income is actually lower by nearly 1%. That’s not terrible, but it does demonstrate that MREIT’s “growth” isn’t perpetual; it’s got to do something new either increase rents, lower costs, or acquire more assets. It has a memorandum of understanding with Megaworld [MEG 1.97 down 0.5%; 25% avgVol] to acquire seven new towers, but MREIT shareholders won’t get the benefit of those new rents until those assets change hands. Still, it’s good to see that MREIT was able to maintain its 95% occupancy rating despite the expansion in its gross leasable area. Just as an aside, I super love this line from the press release: “Of MREIT’s occupied space, 94% is composed of reputable BPO and traditional office tenants with long-term commitment to their leases and operations.” Of course, MREIT intends for us to read that as the remaining 6% being tenants with shorter-term leases, but I think it’s fun to take the other (also reasonable) Interpretation that what they’re saying is that the remaining 6% are just like these heinous and disreputable tenants that MREIT hates. 


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