AREIT secures lead as country’s largest REIT

The real estate investment trust (REIT) unit of real estate giant Ayala Land Inc. (ALI) has extended its lead when it comes to the size of assets under management, thanks to new mall infusions.

In a regulatory filing on Wednesday, AREIT Inc., the country’s first publicly listed REIT, said its board of directors had approved a property-for-share swap with ALI and its subsidiary, Summerhill Commercial Ventures Corp.

The deal involves two mall assets worth P19.5 billion: Ayala Center Cebu and Ayala Malls Feliz in Pasig City. Together, these malls span 375,000 square meters (sq m).

In turn, ALI and Summerhill will subscribe to 441.13 million common shares of AREIT at P44.15 each, a 2.6-percent premium over its last closing price of P43.05.

Once AREIT shareholders approve the swap during a special meeting in December, this will extend the REIT’s gross leasable area to 4.7 million sq m, still the largest in the industry.

Broken down post-transaction, AREIT’s portfolio will be composed of 1.8 million sq m of buildings and 2.9 million sq m of industrial land.

This will likewise expand AREIT’s assets under management to P158 billion.

ALI and AREIT expect the deal to be closed by the second semester of 2026.

“This latest asset infusion strengthens AREIT’s portfolio with two dynamic retail destinations, enhancing both our geographic reach and asset mix,” AREIT president and CEO Alberto de Larrazabal said in a statement.

“As we continue to build scale with quality, our shareholders will benefit from a larger and more diversified portfolio,” De Larrazabal added.

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Year-to-date, ALI has infused P40.5 billion worth of assets into AREIT, marking the latter’s largest annual addition in history.

Last month, ALI and its subsidiaries announced a planned P21-billion asset infusion into AREIT.

The transaction involves eight commercial buildings, namely, Central Bloc Office 1 and 2, AyalaMalls Central Bloc and Seda Central Bloc in Cebu City; AyalaMalls Abreeza and Abreeza Corporate Center in Davao City; and AyalaMalls Centrio and Centrio Corporate Center in Cagayan de Oro City.

In exchange for the properties, the companies will get a total of 505.89 million AREIT primary common shares. INQ

REITs are steadily becoming attractive investment opportunities, especially since these are dividend-yielding and focus on income-generating real estate assets, like malls and office buildings, as well as renewable energy power plants.