AREIT - Achievement in Growth

Company: Ayala Land, Inc. | AREIT Inc. , Makati City, Metro Manila
Company Description: Ayala Land, Inc. is the largest property developer in the Philippines, designing large-scale, mixed-use estates that have grown into thriving economic centers. AREIT, Inc. (AREIT) is the first Philippine Real Estate Investment Trust (REIT), pioneered by the country’s largest and most trusted real estate developer, Ayala Land, Inc. (ALI), as its sponsor.
Nomination Category: Achievement Categories
Nomination Sub Category: Achievement in Growth

Nomination Title: Ayala Land, Inc. | AREIT, Inc.

AREIT, Inc. (AREIT) is the first Philippine Real Estate Investment Trust (REIT), pioneered by the country’s largest and most trusted real estate developer, Ayala Land, Inc. (ALI), as its sponsor.

While REITs have gained traction in capital markets of neighboring countries since 2000, the Philippine REIT industry did not take off until two decades later when the government revised the legal framework which addressed pain points of the previous REIT law.

Seeing the potential of the REIT market, AREIT pushed through with its initial public offering (IPO) last August 2020 despite economic challenges posed by the global health crisis. It was well received by the market, two times oversubscribed. Since then, share price has grown by 27.5%, outperforming both the Philippine Stock Exchange and the Philippine Property indices. AREIT’s dividend declaration of PHP1.32 per share in 2020 enabled AREIT to boost total shareholder return to 30.8% since the IPO.

Within five months from listing, AREIT more than doubled its portfolio from 153 thousand to 344 thousand square meters of leasable area. AREIT was also included by FTSE Russell of the London Stock Exchange as one of its index stocks in the FTSE MICRO-CAP Index last March 19.

Amidst the pandemic, AREIT launched the first Philippine REIT, effectively providing an affordable investment instrument for both large and small investors seeking dividend-based income, inflation protection, and portfolio diversification.

AREIT recorded 2020 revenues of PHP1.95 billion and net income of PHP1.23 billion, higher than original projections.

Within five months from listing, it more than doubled its portfolio to 344 thousand square meters with the acquisition of three prime assets in key growth centers—Teleperformance Cebu, The 30th Commercial Development in Pasig and Industrial Lots in Laguna Technopark.

Its business remains resilient, with uninterrupted operations despite widespread community lockdowns. Occupancy remains high at 99%, and tenancy is stable with long-term contracted leases averaging 9.7 years. Boasting a tenant mix of high credit grade top local and multinational companies, AREIT’s properties act as a strong foundation for the local economy generating over 50,000 jobs for Filipinos.

After its annual stockholders meeting last April 23, AREIT also announced its plans to further expand its portfolio to 549 thousand square meters by infusing ten assets from its sponsor, ALI, via a property-for-share swap. This will increase AREIT’s total asset value to Php52 billion and will further boost dividends of its shareholders in 2021.

Despite regulatory limitations along with the global health and economic crisis, AREIT hurdled all challenges and successfully launched its Php 13.6 billion IPO in August 2020 with two times oversubscription. It signaled the domestic market’s confidence in the company despite the global financial crisis.

AREIT holds on to its sound investment principles that makes it the ‘best-in-class REIT’: the track record of its sponsor, Ayala Land as the largest and most trusted real estate developer in the country; quality assets in prime locations; stable and long-term occupancy by top global and local companies; inflation-hedged growth though contracted rental escalations ranging from 3-5%; and an experienced professional management team. Portfolio growth and income from its first 8 months of operations is proof to AREIT’s commitment of delivering a dependable and secure investment to Filipinos.

AREIT was not only the first mover in the Philippine REIT market, it was also instrumental in refining the implementing guidelines for REITs in the Philippines and placed itself in a unique position to lead by example. Successfully pioneering the REIT market, other local developers are slowly following AREIT’s footsteps with the recent launch of DDMP REIT, Inc. by developer, DoubleDragon Properties last March 2021. While other large players like Filinvest, Megaworld, and Robinsons Land Corporation have also announced their intent to launch their own REITs in the near future.

AREIT has been recognized in less than a year since its listing by several international institutions earning prestigious awards such as ‘Best IPO in the Country’ by The Asset Country Awards 2020, ’Best IPO in South East Asia’ by FinanceAsia 2020 Achievement Awards, ‘Best Investor Relations in a Corporate Transaction’ by IR Magazine 2020 South East Asia Awards, and ‘Best Equity Deal of the Year’ by IFLR 2021 Asia-Pacific Awards and The 5th Annual ALB Philippine Law Awards 2020.

AREIT Website https://www.areit.com.ph/
AREIT Corporate Video https://www.areit.com.ph/media/pages/presentations/a4912e9280-1619687503/areit-corporate-video.mp4