Home Editors' Picks Filinvest’s REIT makes market debut; Megaworld REIT gets go signal

Filinvest’s REIT makes market debut; Megaworld REIT gets go signal

Filinvest REIT Corp. manages a portfolio of 17 office buildings, of which 16 are located in Northgate Cyberzone, Filinvest Corporate City in Muntinlupa. — COMPANY HANDOUT

By Keren Concepcion G. Valmonte, Reporter

SHARES in the real estate investment trust (REIT) sponsored by Filinvest Land, Inc. (FLI) rose less than a percent higher in its market debut on Thursday, amid the strict lockdown in the capital region and the threat of the Delta variant of the coronavirus disease 2019 (COVID-19).

At the same time, Megaworld Corp.’s REIT unit secured approval from the Philippine Stock Exchange (PSE).

Filinvest REIT Corp.’s (FILREIT) shares closed at P7.02 each on Thursday, 0.29% or two centavos higher than its P7 offer price, while the PSE index fell 1.65% (Related story). Its shares opened at P6.97, and reached an intraday low of P6.96.

“FILRT’s (the company’s ticker symbol) market debut started on a positive note, reaching as high as P7.14 and eventually traded sideways above the P7.02 area,” Timson Securities, Inc. trader Darren Blaine T. Pangan said in a Viber message. 

“The stock ended slightly higher despite the index inching lower amid the weak sentiment looming over the broader market,” he added.

FILREIT raised P12.6 billion from its initial public offering (IPO). It manages a portfolio of 17 office buildings with over 300,000 square meters. Sixteen of these buildings are located in Northgate Cyberzone, Filinvest Corporate City in Muntinlupa.

“It is a vote of confidence not only in our company and this new asset class but also in our country and in what has proven to be a most resilient industry in our economy — the BPO (business process outsourcing) sector,” FLI President Josephine Gotianun-Yap said in a statement.

The Gotianun-led company remains optimistic about the growing demand for office spaces in its buildings, despite the strict lockdowns. 

“Work from home is not really for everyone and based on the industry research and reports, there’s a lot of issues [on] working from home,” FILREIT President and Chief Executive Officer Maricel Brion-Lirio said during a media briefing. 

“Our outlook for the office sector as a whole is optimistic and positive,” she added.

During the listing ceremony on Thursday, Finance Secretary Carlos G. Dominguez III urged the Filinvest group to further expand its property developments, particularly outside of Metro Manila.

“REIT has proven to be the ideal tool for raising the billions required to power property development in the country. This will propel the growth of the property sector beyond the pandemic… Filinvest’s REIT listing underscores the confidence that the Philippine economy is on track to a solid recovery from the difficulties brought about by the pandemic,” Mr. Dominguez said.

Ms. Gotianun-Yap said the Filinvest group will continue to further expand its existing businesses.

“The Filinvest group has built a very strong foundation for solid growth. Many of our businesses we have not even optimized the capacity, so there’s still a lot of room for growth and that’s what we are working on in addition to going into synergistic businesses,” she said.

FILREIT is the third REIT firm listed on the local stock exchange, which will soon see two more make their market debut.

Meanwhile, the PSE on Thursday approved the listing of the shares of the REIT unit sponsored by Megaworld.

MREIT will be offering to the public 1,078,000,000 common shares owned by Megaworld for P22 each, with an overallotment option of up to 161,700,000 common shares. 

Its offer period is set from Sept. 14 until Sept. 20, with a tentative listing date scheduled for Sept. 30. It will have the stock symbol “MREIT.”

The company may raise up to P27.3 billion from the IPO, should the overallotment option be exercised. 

MREIT included in its initial portfolio 10 key office assets, which are located in Eastwood City in Quezon City, Mckinley Hill in Bonifacio Global City, and Iloilo Business Park in Mandurriao, Iloilo City. 

Robinsons Land, Inc.’s REIT firm earlier this week received the PSE’s go signal for its IPO. RL Commercial REIT, Inc.’s offer period is expected to run from Aug. 25 to Sept. 3. It aims to list its shares by Sept. 14 under the ticker symbol “RCR.”

These REIT listings all focus on the office spaces in their portfolio, despite muted demand with many companies shifting to work-from-home arrangements due to the continued lockdown restrictions and concerns over COVID-19.

“Lockdowns [caused by the] pandemic since last year could be a drag on office demand and this could be already priced in [or be] reflected in the valuation,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a text message.

Analysts said REIT offers would remain attractive considering their dividend yield.

‘For as long as there’s excess system liquidity keeping interest rates low, helped by the BSP’s (Bangko Sentral ng Pilipinas) monetary accommodation, REITs’ yield will be attractively superior versus other asset classes,” First Metro Investment Corp. Head of Research Cristina S. Ulang said in a separate Viber message.

A pickup in the pace of the country’s vaccination program may also boost investor sentiment.

“Increased vaccination would be a catalyst in the coming months especially if population protection and eventually herd immunity is reached in the coming months as this could fundamentally help sustain the economic recovery prospects,” Mr. Ricafort said.