AREIT earnings rise with new acquisitions
AREIT Inc., the real estate investment trust sponsored by property giant Ayala Land Inc., registered a 42 percent jump in net income, excluding the net fair value change in investment properties, to ₱3.43 billion in the first nine months of 2023.
In a disclosure to the Philippine Stock Exchange (PSE), the firm said this came on the back of a 97 percent occupancy rate recorded at the end of the period.
AREIT posted total revenues of ₱5 billion and Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of ₱3.56 billion, 41 percent and 39 percent higher year-on-year respectively.
This is on account of stable operations and the contribution of the new assets acquired this year and in the last quarter of 2022 through its property-for-share transactions with Ayala Land.
Last Sept. 20, 2023, AREIT obtained the Securities and Exchange Commission’s (SEC) approval of ALI and its subsidiaries Ayalaland Malls, Inc., and Northbeacon Commercial Corporation’s subscription to 607.56 million AREIT shares worth ₱22.48 billion.
This is in exchange for the following properties: One Ayala Avenue East and West BPO
Towers at the corner of Ayala Avenue and EDSA, the Glorietta 1 and 2 mall wing and BPO buildings at Ayala Center, and the Marquee Mall in Angeles, Pampanga.
The new assets contributed to AREIT’S performance beginning the third quarter of 2023 and boosted its gross leasable area (GLA) more than five-fold to 861 thousand sq. meters.
Moreover, the company’s Assets Under Management (AUM) reached approximately ₱87 billion, nearly triple its size since it went public and currently the largest among Philippine REITS.
From its initial public offering in 2020, the company has grown revenues annually by 51 percent on average, driven by the significant expansion of its assets.
AREIT, the first Philippine REIT, has a diversified portfolio of offices, malls, hotel, and industrial land, which reduces concentration risk in any one particular asset class.
On Sept. 28, 2023, AREIT was recognized for its corporate governance practices. It received a two-golden Arrow award from the Institute of Corporate Directors based on the 2022 ASEAN Corporate Governance Scorecard at the 2023 Golden Arrow Awards.
AREIT is a constituent of the FTSE EPRA Nareit Asia ex-japan REITS 10 percent capped Index, the MSCI Philippine Small Cap Index, the FTSE Small Cap Index, and the Philippine Property Index.