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By Denise A. Valdez, Senior reporter
AREIT, Inc. is purchasing the 76,000 square meter (m2) shopping center from Ayala Land, Inc. (ALI) in Pasig City to expand its portfolio.
In a disclosure to the exchange on Friday, ALI’s Real Estate Investment Trust (REIT) said its board of directors approved the acquisition of The 30th at Av. Meralco, Pasig City.
The 30th is a three-year-old commercial development along Avenida Meralco with a fully occupied office building and a retail services podium.
Full ownership of the building and the lease of the land will be acquired by AREIT from ALI. The acquisition will be financed by debt, which is the first debt of the company in its history.
With the transaction, AREIT will increase its gross leasable portfolio to 246,000 square meters. from 170,000 square meters. in the present.
“Simultaneously to the acquisition of the building by AREIT, (Ayala Land) will assign the long-term lease of land to AREIT. AREIT (will lease) office space to tenants and the retail podium to Ayala Land, under a fixed lease as the operator of the commercial spaces, ”he said.
The acquisition of new assets is expected to boost AREIT’s net income and dividends in 2021. It also purchased an office building in Cebu City last September using P1.45 billion of the proceeds from the public offering.
In a separate disclosure on Friday, AREIT said its board of directors approved the issuance of retail bonds and / or corporate notes with the goal of raising up to P6.4 billion. The facility will have a maturity of up to 10 years and will support the company’s asset acquisitions.
Likewise, the board of directors approved the establishment of bank credit lines for up to $ 12 billion.
AREIT currently has four properties in its portfolio: Teleperformance Cebu, a 12-story office building in the city of Cebu; Solaris One, a 24-story commercial building in the city of Makati; Ayala North Exchange, a two-tower mixed-use development in the city of Makati; and McKinley Exchange, a five-story business office in the city of Makati.
It made an initial public offering (IPO) of P12.33 billion in August, marking the country’s first REIT listing in history. As required by REIT guidelines, AREIT must reinvest the proceeds from its offering to the Philippines within one year of its IPO.
AREIT’s shares on the stock exchange lost five cents or 0.19% to close at P25.65 each on Friday.
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