AREIT to accelerate expansion as retail, hospitality sectors recover

AREIT Inc., the real estate investment trust company of Ayala Land Inc., is ready to further expand and diversify its portfolio as the retail and hospitality sectors start to recover.

AREIT president Carol Mills said during the company’s annual stockholders meeting the group’s strategy is to seek out opportunities for office properties and complement them with hotel and retail components.

“As we enter 2023 with a track record of delivering solid performance and growth, AREIT is ready to accelerate expansion and diversify its portfolio,” Mills said.

“With the pandemic behind us, we see a strong rebound in commercial businesses, particularly retail establishments. This improvement provides an opportunity to expand and balance AREIT’s portfolio, in line with its prospectus when we listed it as a commercial REIT,” she said.

AREIT is undertaking P22.5 billion worth of asset infusion which would increase total assets to P87 billion and portfolio to 23 properties.

The infusion which involves prime flagship assets from ALI office and malls would enable AREIT to achieve its three-year investment plan of P90 billion in assets under management.

The proposed assets to be acquired by AREIT include One Ayala Avenue at the corner of Edsa and Ayala Ave. with 71,000 square meters of office space, the newly-redeveloped Glorietta 1 and 2 mall and office buildings and Ayala Mall Marquee in Angeles City, Pampanga.

ALI’s crown jewel—Glorietta 1 and 2—is home to essential local and foreign retail brands and well-established F&B offerings. It also has two office buildings on top of the mall, while MarQuee Mall has consistently been one of the group’s top-performing provincial malls, pre- and post-pandemic.

AREIT’s portfolio is composed primarily of offices, with high occupancy of 98 percent.

It said about 88 percent of expired office leases were renewed, and all 7,000 sq. m. of pre-terminated leases in 2022 were replaced.