MREIT, Inc. emerged as one of the most actively traded stocks last week following the property-for-share swap deal with Megaworld Corp.
A total of 81.77 million MREIT shares worth P1.01 billion were traded from June 3 to 7, data from the Philippine Stock Exchange (PSE) showed. MREIT was the sixth actively traded stock last week.
The real estate investment trust (REIT) arm of Megaworld Corp. closed at P12.58 per share, picked up slightly by 0.2% from May 31’s closing price of P12.56 apiece. Since the first trading day of the year, the stock’s price has gone up by 2.3%.
“This block sale was not a surprise at all as MREIT has been quite transparent about it plans to hit 500,000 square meters (sq.m.) total gross leasable area (GLA) by the end of 2024. Despite this though, it sprinkled a bit of temporary optimism to investors as the asset infusion is expected to increase the overall cash flow of MREIT, thereby increasing its distributable income,” Jemimah Ryla R. Alfonso, equity analyst at Regina Capital Development Corp. said in an e-mail.
Although the deal did spark a wave of temporary optimism, the enthusiasm faded by the end of the week. Ms. Alfonso said that this might be because the move had already been anticipated.
Last week, Tan-led property developer Megaworld sold 79.7-million MREIT common shares at an average sale price of P12.3001 per share, equivalent to P980.32 million before the deduction for fees and taxes, said in a PSE disclosure. This is in line with the company’s fundraising efforts.
For the January-to-March period, MREIT generated P1.08 billion in revenues. Meanwhile, the company’s net profit stood at P733.13 million, 37.2% increase from P730.42-million growth in the same period last year.
“Based on our forecast, we see the infusion to add P3 billion in MREIT’s revenues,” added Ms. Alfonso. We see MREIT’s full year’s top line to reach P6 billion with the newly infused properties,” said Ms. Alfonso.
For 2023, MREIT recorded a 13% increase in its distributable net income to P2.8 billion from P2.5 billion in 2022 due to higher revenues.
The company saw a 14% increase in revenues to P4.2 billion, amid full-year contribution of four additional Grade-A office towers from January 2023, as well as steady rental escalations among current tenants, it said in a disclosure.
Last year, MREIT, Inc. signed a memorandum of understanding with its sponsor for the possible acquisition of seven offices to the portfolio of the real estate investment trust.
The assets have a total gross leasable area (GLA) of 150,500 sq.m. Once completed, MREIT’s portfolio will increase to 475,500 sq.m., 46% higher from its current 325,000 sq.m., on track to its total GLA to 500,000 sq.m. target of assets by end-2024.
MREIT’s portfolio covers 18 office properties to date. These are 1800 Eastwood Ave., 1880 Eastwood Ave., and E-Commerce Plaza in Eastwood City; One World Square, Two World Square, Three World Square, 8/10 Upper McKinley, 18/20 Upper McKinley, and World Finance Plaza in McKinley Hill.
“The barrier that we are seeing is at P13.12 per share, while the stronghold of the stock is at P12.50 per share,” said Ms. Alfonso. — Lourdes O. Pilar
