Ayala Land REIT H1 income up 31% after asset infusion
Areit inc., the real estate investment trust (reit) of Ayala Land inc. (ALI), said its income in the first semester reached P1.34 billion, up by 31 percent year-over-year, using the fair value method.
Using the cost method, which factored out unrealized gains in the fair value recognition of its properties, Areit’s net income reached P1.01 billion, 55 percent higher than last year, reflecting the company’s growth in earnings from its new properties and the stability of its existing buildings.
The company said it secured the
approval of the Bureau of Internal Revenue to change the accounting method it uses in valuing investment properties to fair value method from cost method to reflect the market value of its properties and align financial reporting practices with that of global REITS.
The company received the approval last June which takes effect retroactively from January 1 this year.
“As we complete our first full year of operations as a REIT since August 13, 2020, we have delivered consistently on our targets and positioned the company for growth with the addition of new assets. We instituted measures to assure our locators and customers of the safety of our properties and personnel amidst the pandemic,” Carol T. Mills, the company’s president and CEO, said.
The company said it posted revenues of P1.36 billion, some 49 percent higher than the previous year as a result of the positive contribution of new properties—the 30th in Pasig, and land parcels in Laguna Technopark it acquired last January, Teleperformance Cebu in October 2020, as well as rental escalations of existing leases.
It was able to sustain a high occupancy rate of 99 percent.
In June, Areit and Ayala Land and its subsidiaries, Westview Commercial Ventures Corp. and Glensworth Development Inc., executed the deed of exchange on the property-forshare swap transaction.
Areit currently has six properties with a total gross leasable area (GLA) of 344,000 square meters and assets under management valued at P37 billion.
Its GLA is slated to grow to 549,000 square meters while the value of its managed assets will rise to P52 billion.
Some P15.5 billion worth of commercial assets will also be infused into the company from Ayala Land. The share swap transaction is expected to be completed within the second half of the year.