MANILA, Philippines — Shareholders of AREIT, Inc., the real estate investment trust of the Ayala Group, have greenlit the acquisition of six commercial properties worth ₱17.3 billion from its primary sponsor, Ayala Land, Inc. (ALI), and its subsidiaries.
The asset-for-share swap will raise AREIT’s total assets under management (AUM) from ₱159 billion to ₱177 billion. In exchange for the prime real estate assets, AREIT will issue 462.48 million new common shares to ALI and affiliated companies—Capitol Central Commercial Ventures Corporation, Makati Cornerstone Leasing Corporation, Bay City Commercial Ventures Corporation, and North Triangle Hotel Ventures, Inc.—at ₱37.48 per share.
“These infusions strengthen AREIT’s scale and diversify our portfolio across offices, retail, and hospitality, while introducing lease structures that allow us to participate more directly in the operating performance of these assets,” AREIT President and CEO Alberto de Larrazabal said.
“This gives AREIT additional avenues for sustainable growth while strengthening the quality and recurring income base of the portfolio,” De Larrazabal added.
The acquisition shifts AREIT’s asset mix away from a heavy reliance on traditional office spaces by incorporating four shopping malls and two hotel developments across key commercial hubs in Metro Manila and the Visayas.
Following the integration, office properties will account for 55% of the total portfolio, retail space will make up 33%, hospitality assets will reach 8%, and land holdings will stand at 4%. The combined 41% share for retail and hotel assets marks the firm’s highest allocation to these two segments to date.
The transaction also alters AREIT’s income structures. The incoming retail properties will utilize direct leasing arrangements, while the hotel properties will adopt hybrid master leases combining fixed base rent with variable performance-based revenue components.
Company executives anticipate the expanded asset base will boost distributable income and bolster long-term dividend growth.
Income from the newly acquired properties will accrue to AREIT upon securing final regulatory approvals from the Securities and Exchange Commission (SEC).