Ayala Land back at bond market, this time for P15B
Ayala Land Inc. (ALI) has started raising up to P15 billion from its sustainability-linked bond offer after the Bangko Sentral ng Pilipinas (BSP) cut rates for the fourth time this year.
The Zobel family-led real estate giant informed the Philippine Stock Exchange on Friday that the Securities and Exchange Commission had approved its issuance.
The offer will have a base amount of P10 billion. There is an oversubscription option of up to P5 billion in case of high demand.
It will consist of Series C bonds due 2030 at a rate of 6.0671 percent per year. There are also Series D bonds due 2035 at 6.3192 percent.
The offer period will end on Oct. 15, with listing scheduled on Oct. 23.
This represents the fourth tranche of ALI’s P50-billion shelf registration approved in 2023. It raised P10.25 billion in June 2023, another P6 billion in July 2024 and P8 billion in November last year.
The latest issuance also comes after the BSP slashed the rate for overnight borrowing by another quarter point to 4.75 percent. This was the lowest since Sept. 2022.
Rate cuts typically make fixed-income securities, like bonds, more attractive because these promise a higher yield for investors.
Augusto Bengzon, ALI management committee member and former chief financial officer, earlier told reporters they decided to pursue another sustainability-linked bond offer because this had been “well-received” by investors.
The developer is aiming to launch 21 projects worth P57 billion in the second semester of the year.
Roughly two-thirds of these will be in the premium market under AyalaLand Premier and Alveo Land. This is in recognition that this segment still performs better than its core markets, or those in the middle-income segment.
ALI netted P14.2 billion in the January to June period. This was up by 8 percent thanks to its diverse portfolio, although the weak residential market prevented faster growth.
Revenues, on the other hand, were flat at P83.1 billion.
Apart from the residential segment, ALI is also pursuing expansion in its hospitality business.
In June, AyalaLand Hospitality took over the 500-key New World Hotel in Makati. This drove the group closer toward its goal of doubling its hotel room capacity to 8,000 by 2030.
