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By: Marvin Germo | February 8, 2020

Who’s Going To Be The First REIT?

Ayala Land, Inc. (ALI) has applied for the real estate investment trust (REIT) offer in the Philippines. It was the first application submitted to the Securities and Exchange Commission. The subsidiary of ALI, which is AREIT, Inc. was the one who applied for the REIT last Jan 7, 2019. The application disclosed that it is going to offer up to 478,639,700 shares at the price of P30.05 each. The company expects that this will give them up to P1.356 billion as net proceeds. Who’s excited about this news? I bet those who are looking forward to REITS can now see the light!

Catch me in my live training events! (quick plug)

The heart of why I do these seminars is I want to build a generation of Filipinos with the right foundation in stock investing.  I want to bring smart investing to every Filipino around the world! If you would like to know more about how you could time the market check out the training below.

Stock Smarts Taiwan – February 15, 2020
Stock Smarts Manila: March 14, 15, 21, 22 & 28, 2020
Stock Smarts Singapore: May 16 – 17, 2020
Stock Smarts New Zealand: June 6 – 7, 2020
Stock Smarts Sydney: July 11 – 12, 2020
Stock Smarts London: April 18 – 19, 2020

About the Offer

ALI said that the offer will compose of 478,639,700 shares at P30.05 each. There will be 47,864,000 new common shares and 430,775,700 existing common shares, and 23,932,000 shares for over-allotment option. This enables the company to pave the way for the development of a REIT market in the Philippines. It also expects that this is going to be another milestone to the Philippine stock market. The initial public offering of AREIT will be done once the regulatory approvals are obtained from the Philippine Stock Exchange and SEC.

AREIT’s Prospectus

The prospectus of AREIT stated that the REIT plan will have 3 commercial buildings: the five-story McKinley Exchange, the 24-story Solaris One, the mixed-use development Ayala North Exchange. These are considered as Grade A office assets all located in Makati central business district. Its portfolio will continue to expand with the company’s new acquisitions in the future. The proceeds from the offer will be used by the end of 2020 to follow the guidelines of the REIT here in the Philippines. 90% of the proceeds, which is P1.22 billion, will be for the future investments in real estate, and the remaining 10%, which is P136 million will be for general corporate purposes.

ALI’s First Application

ALI’s filing of application is considered to mark the first-ever successful attempt to register a REIT after 10 years since the law has passed. This is good timing since the REIT regulations have been relaxed recently, giving flexibility companies that are planning to become REITs. According to the new law, the minimum public float requirement is now 33% and the 12% VAT has been removed. There are also other firms that showed their interest in REITs including Megaworld, Robinsons Land, and CPG.

I’m excited to share my 5th book overall and the 4th book in the Stock Smarts series, Stock Smarts: Breaking the Resistance – How to time your traders perfectly. The heart of this book is to teach you strategic ways on how to come in and buy and sell stocks in a way where you come as the market is headed up and come out as the market is headed down. The book is now out and exclusive via Marvin Germo Book Orders.
For more details and to order my other books: Marvin Germo Book Orders