AREIT identifies 10 properties in P15-B swap deal with Ayala Land

AYALA LAND, Inc.’s real estate investment trust AREIT, Inc. has identified 10 properties included in the P15-billion property swap deal.

In a disclosure to the exchange on Wednesday, AREIT said the deal totaled 250,000 square meters (sq.m.) of leasable space, which includes: Vertis North Commercial Development; One and Two Evotech in Nuvali Santa Rosa, Laguna; Bacolod Capitol Corporate Center; Ayala North Point Technohub; office condominium units at BPI-Philam Life buildings in Makati’s Central Business District; and the Madrigal Business Park in Alabang.

“This transaction demonstrates the priority of a well-designed REIT, which is to generate compelling yields for its shareholders. At the same time, it allows AREIT to grow its assets significantly and increase shareholder value,” AREIT President and Chief Executive Officer Carol T. Mills said in a statement.

The largest of the properties is based in Quezon City, Vertis North. The commercial development includes 125,000 sq.m. of leasable space and a 39,000-sq.m. retail podium.

The development’s retail component is operated by Ayala Land subsidiary under the Ayala Malls brand.

“[It] will pay a monthly guaranteed building lease to AREIT for a period of 36 years, ensuring stable income to AREIT,” the company said.

Vertis North’s three office buildings are 97% occupied. These spaces are currently leased to large business process outsourcing companies, as well as Google Services Philippines, Inc., Teleperformance, Telus Corp., and Global Payments, Inc.

The Nuvali Evotech properties meanwhile offer 23,000 sq.m. of leasable area. It is currently occupied by Concentrix CVG Philippines and IBM Business Services.

In Negros Occidental, Bacolod Capitol Corporate Center features 11,000 sq.m. of leasable area, which is currently occupied by ARB Call Facilities. Meanwhile, the 5,000-sq.m. Ayala North Point Technohub is housing iQor.

“Furthermore, the office condominium units in the BPI-Philam Life Buildings in Makati and in Alabang have a total of 1,500 sq.m., 100% occupied and leased to Oberthur Card Systems in Makati and Amaia Land, an Ayala Land subsidiary headquartered in Alabang,” AREIT said.

The property-for-share deal with Ayala Land is still subject to the approval of shareholders and regulatory bodies.

AREIT’s board of directors also approved the increase in the company’s authorized capital stock to P29.5 billion from P11.74 billion on Tuesday.

The board has also approved the subscription of Ayala Land to 483.25 million primary common shares of AREIT at P32 per share to swap for the Ayala Land commercial developments valued at P15.46 billion.

The transaction will bump AREIT’s outstanding common shares to 1.51 billion from 1.02 billion shares. Ayala Land will own some 66% of the total shares.

AREIT’s deposited property value will also bump to P52 billion from P37 billion. The company’s leasing portfolio will increase to 549,000 sq.m. from 344,000 sq.m.

“The properties are expected to contribute further to its operating cash flows, boosting dividends per share,” AREIT said.

AREIT shares at the stock exchange rose by 0.61% on Wednesday to close at P33 apiece from P32.80. — Keren Concepcion G. Valmonte