CLI to pursue REIT listing in the future

While Real Estate Investment Trust (REIT) is attractive, Cebu Landmasters Inc., (CLI) believes it is not yet ready to enter into organized partnerships.

The listed real estate firm is giving itself another four to five years to coinciding with the maturity of its recurring income assets,” said CLI chief finance officer Grant Cheng.

REIT is a company that owns and in most cases operates income-producing real estate. REITs own many types of commercial real estate, including office and apartment buildings, warehouses, hospitals, shopping centers, hotels and commercial forests

“REIT is definitely in our plans in the medium term. We want to make sure that we are offering a quality product that has been tested, and proven and I believe this is a necessary requirement with several years of track record,” Cheng explained.

According to Cheng, the company expects its recurring income portfolio to contribute largely to the company’s earnings in three to four years.

“If you look at the pipeline of our hospitality projects, we will be opening some in 2023 to 2024, if you factor in a little ramp-up time until the opening, we want to target at least five to 10 percent from these recurring projects,” Cheng noted.

CLI targets to grow revenues at least five percent to 10 percent from its recurring income projects.

According to real estate consultancy firm JLL, the Philippine’s office segment is seen to get a boost despite the effects of pandemic, with the existence of REIT in the Philippines.

According to JLL Philippines, the office segment the most attractive asset class going forward.

JLL believes that REITs are one of the country’s future bright spots and will play an important role in jumpstarting the economy from the adverse effects of the pandemic and will promote growth in the real estate sector.

REIT also is seen to provide a cheap funding source for developers, raising fresh capital for finance future projects, which in turn will ramp up construction activities and employment, said Janlo de los Reyes, JLL Philippines’ head of research and consultancy.