Mreit Inc., the real estate investment trust (REIT) of Megaworld Corp., on Thursday said it is set to acquire additional office assets from the Andrew Tan-led property developer worth around P20 billion this year.
With the infusion, Mreit will increase its portfolio value by 34 percent P78.5 billion by the end of 2022 from the current P58.5 billion.
Megaworld did not identify the assets, but said these properties will come from its various developments in the country. “Mreit is looking to surpass its target for 2022 in terms of asset injection. These new assets may include some of our ‘built-to-suit’ properties, which are considered superior in both quality and lease tenure. These new properties have a multinational tenant base, which include large financial, healthcare, technology, and consulting firms,” said Kevin Andrew L. Tan, president and CEO of Mreit.
“We earlier announced an additional 44,300 square meters by end of the year, but we are working to further bulk it up with more assets as we continuously look for ways to increase dividend yields for our shareholders,”
In December, Mreit completed the acquisition of four commercial properties with a total gross leasable area (GLA) of 55,700 square meters for P9.1 billion. By the end of 2021, Mreit’s expanded portfolio already consisted of 14 prime buildings with a total GLA of around 280,000 square meters located mainly in PEZA-accredited zones in Megaworld’s developments in Eastwood in Libis, Quezon City, McKinley Hill in Taguig and Iloilo Business Park.
“We believe that the current business conditions are conducive to the attainment of our growth plans. We are currently looking at several properties for potential acquisition, not just in these three townships but also in two more new Megaworld townships. We are very optimistic of our very long growth runway considering that Megaworld is building more offices and even launched new townships last year,” Tan said.
The various properties will be infused throughout the year with funding expected to come primarily from equity and potentially some debt. Currently, Mreit’s percentage of debt versus total deposited properties is around 12 percent, below the 35-percent cap set in the REIT Law.
“There are still a number of items that we have to finalize, and as everyone knows, we have to go through the process as set under the REIT Law. But our objective for the year is to deliver on this enhanced investment plan and ensure the sustained growth of the company,” Tan said.
Mreit, which left out many of Megaworld’s properties during its initial public offering last year, wants to be one of the largest REITs in Southeast Asia. It aims to have a portfolio GLA of 500,000 square meters by 2024 and increase this further to 1 million square meters before the end of the decade.