LISTED property developer Megaworld Corp. is planning to inject additional office and retail assets into its real estate investment trust MREIT, Inc. next 12 months.
“We’ll add one other 250,000 square meters of mostly malls and offices,” Kevin Andrew L. Tan, president and chief executive officer of parent firm Alliance Global Group, Inc. (AGI), told reporters last week.
Megaworld Investor Relations Head Andy Dela Cruz said the corporate plans to infuse office assets first, followed by mall assets by the second.
The corporate plans to inject 10 office assets into MREIT, with a valuation of at the very least P15 billion.
“We’re currently reviewing all the shops under Megaworld, since the goal is basically to infuse every little thing, step-by-step,” Mr. Dela Cruz said.
MREIT is targeting to expand its asset portfolio to 1 million square meters (sq.m.) of gross leasable area (GLA) by 2027.
“By 2030, Megaworld may have three million square meters in total — two million square meters in offices, and a million square meters in retail. So by 2030, there’s at the very least 2 million square meters more that we wish to place,” Mr. Dela Cruz said.
At present, MREIT’s properties are positioned inside Megaworld’s townships, including Eastwood City, McKinley Hill, McKinley West, Iloilo Business Park, and Davao Park District.
Mr. Dela Cruz said Megaworld had launched P20 billion price of projects as of end-September, already meeting its full-year goal.
“For the rest of the 12 months, we’re studying the actual estate market demand, and we’re able to launch anytime there’s demand,” he said.
Megaworld expects firm demand across its office, retail, and hotel segments to support full-year performance, Mr. Tan said.
“I feel this 12 months continues to be going to be growth because we had a excellent start of the 12 months, and I feel the demand continues to be strong. But in fact, there’s plenty of wait and see amongst our clients,” he added.
Mr. Tan also said AGI, Megaworld’s parent conglomerate, is on course to post growth this 12 months.
“There’s been some recovery within the retail core business. Travellers [International Hotel Group, Inc.] is also experiencing some growth this 12 months, so I feel overall, AGI [growth] can be good as well,” he said.
“I just think that perhaps if ever there’s a bit little bit of headwinds on the liquor side.”
AGI’s core businesses include real estate development, tourism-entertainment and gaming, and food and beverage through its liquor unit Emperador, Inc.
AGI posted a 24% increase in nine-month net income to P24.8 billion, with Megaworld contributing essentially the most after its net profit attributable to parent company rose 16% to P15.9 billion.
Meanwhile, MREIT reported a 27% increase in distributable income to P2.8 billion as of end-September following the acquisition of additional office assets.
On Friday, Megaworld Corp. shares fell by one centavo or 0.49% to shut at P2.04 apiece. — Beatriz Marie D. Cruz