P27 each set for AREIT IPO

The float will provide a new asset class to the public, allowing investors to diversify their portfolio and democratize ownership of real property assets

The country's first real estate investment trust, the Ayala group's AREIT Inc., will go on offer next week at P27 per share which was lower than the maximum indicative price of P30.

At the set price, AREIT expects to generate P12.336 billion.

The float will provide a new asset class to the public, allowing investors to diversify their portfolio and democratize ownership of real property assets, ALI said in a statement.

AREIT intends to use the net proceeds from the primary offer to fund the acquisition of Teleperformance Cebu from ALO Prime Realty Corp, a wholly-owned subsidiary of Ayala Land Inc. (ALI) or an alternative property from ALI or any of its subsidiaries or affiliates that financially and strategically meets or exceeds Teleperformance Cebu and AREIT's financial and strategic investment criteria.

Proceeds to be reinvested

The net proceeds from the secondary offer shall be reinvested by ALI, as sponsor to AREIT, in real estate projects located in the Philippines within a period of one year from receipt thereof, consistent with applicable rules and regulations.

The AREIT IPO shall include the offer and sale of up to 456,883,000 common shares of AREIT, consisting of 47,864,000 new common shares and 409,019,000 existing common shares.

Index down 1.2%

The Philippine Stocks Exchange (PSEi) was down 1.2 percent with thin trading worth P4.5 billion against the July average of P6.3 billion with foreigners continuing to dump equities which now totaled P3.3 billion worth of sales for July.

“Worth noting was Semirara Mining and DMCI Holdings Corp. which both dropped five percent on news of a fatal incident on its quarry Narra Pit,” according to Unicapital Securities Inc.

“We believe investors are still on a wait and see mode as earnings season goes under way but also fearful of the continuous rise in new daily coronavirus cases in the country.”

PHOTOGRAPH COURTESY OF ALI ALI expects property to remain a viable investment amid the global pandemic. It maintained an optimistic outlook for the sector through long-term investment strategy and innovative business approach.