VISTA LAND & Lifescapes, Inc. (VLL) has set the interest rates for the fixed-rate retail bonds worth up to P10 billion that it is set to issue next month.

In a disclosure to the stock exchange, the Villar-led property developer said the interest rate for its fixed-rate retail bond is pegged at 5.6992% per annum. The bonds have a tenor of five years and six months, due June 2025.

The bonds will have a base size of P5 billion with an oversubscription option of up to P5 billion.

The base amount of P5 billion will be taken from the company’s remaining shelf registration approved by the Securities and Exchange Commission (SEC) on July 18, 2017. Any oversubscription of up to P5 billion will be issued from the P30-billion new shelf registration.

VLL said the bonds will be offered through the joint issue managers, joint lead underwriters and joint bookrunners — China Bank Capital Corp., PNB Capital and Investment Corp. and SB Capital Investment Corp. from Friday (Nov. 29) to Dec. 10.

The bonds are expected to be issued on Dec. 18.

Credit Rating and Investors Services Philippines, Inc. has given VLL its top credit rating of AAA. VLL’s retail bonds also received PRS Aaa rating from the Philippine Rating Services Corporation (PhilRatings).

In a statement issued last week, PhilRatings said it considered three factors in giving VLL the highest credit rating: the company’s diversified portfolio, its improving profitability and the favorable real estate industry outlook.

The listed firm, which is known for residential brands such as Camella and Camella Condominium (COHO), has been expanding its mass market mall portfolio.

PhilRatings cited VLL’s acquisition of Starmalls, Inc. in 2015, which it said helped diversify the company’s portfolio.

“VLL has built over 400,000 homes, 31 malls, 52 commercial centers and seven office buildings. As of September 30, 2019, the company’s projects were distributed in 147 cities and municipalities in 49 provinces throughout the Philippines,” PhilRatings said.

PhilRatings also took note of the 11.9% compound annual growth rate of VLL’s consolidated revenues since 2014. It said the company was able to maintain strong margins as its average gross profit margin stood at 59.8% over the past five years.

In the first nine months of 2019, VLL’s attributable net income increased 12% to P8.83 billion, as its consolidated revenues grew 9% to P34.36 billion.

The company also said it plans to raise up to P40 billion from the bond market to fund its residential and commercial projects. — CRAG