Property developer Ayala Land Inc. is selling a mixed commercial development in Ortigas City to its real estate investment trust company AREIT Inc. for P5.1 billion.
AREIT said in a disclosure to the stock exchange Friday it would acquire The 30th, a 76,000-square-meter commercial development along Meralco Avenue in Pasig City. It will be the fifth office building under AREIT’s portfolio.
AREIT said the acquisition would allow it to increase total portfolio of assets from 170,000 sq. m. to 246,000 sq. m. of gross leasable area. It will also contribute to net income and dividends in 2021, it said.
The 30th is a commercial development that was planned and developed by Ayala Land and completed in 2017. The office building is fully occupied predominantly by companies engaged in business process outsourcing. It includes an amenity retail podium which will be operated and leased by Ayala Land from AREIT.
AREIT plans to raise up to P6.4 billion from the debt market. Among the options being considered by the company are the issuances of 10-year retail bonds, corporate notes, bilateral loans or preferred shares.
The company said it would also establish credit facilities with several banks amounting to P12 billion.
AREIT acquired an office building in Cebu also from Ayala Land for P1.45 billion in September. Teleperformance Cebu has gross leasable area of 18,092 sq. m.
The REIT firm has a portfolio of three Grade-A properties in Makati City, including Ayala North Exchange, Solaris One and McKinley Exchange.
Ayala Land, the sponsor of AREIT, owns 54 percent of the company. AREIT is the first REIT company to list with the Philippine Stock Exchange.
The share price of AREIT dropped 0.19 percent on Friday to close at P26.65.