Shares of Filinvest REIT Corp., which made its debut on the Philippine Stock Exchange (PSE), weathered the market’s decline on Thursday and closed at P7.02, slightly higher than its initial public offering (IPO) price of P7 apiece.
The Filinvest Land Inc.-sponsored real estate investment trust (REIT) company made its debut on the stock market amid the resurgence of risk aversion during the Chinese Ghost Month and the strictest lockdown in Metro Manila, which forced regulators to conduct an online-only affair.
The benchmark index, PSEi, closed 110.29 points lower at 6,556.57 points. Volume of trade was high, valued at P18.22 billion, mainly as a result of Filreit’s listing worth P12.6 billion.
“After months of great uncertainty, we finally arrived in our destination: the Philippine Stock Exchange. We have successfully braved the headwinds the past months and we are excited to welcome Filinvest REIT into the Filinvest family after its successful IPO.
Not only have we made history as the country’s first sustainability-themed publicly listed real estate investment trust or REIT. Our IPO may also be considered the ‘bravest’—given that our stock market debut took place when we are under ECQ [enhanced community quarantine] conditions,” said Josephine Gotianun-Yap, Filreit chairman and FLI president.
“While some may call it ‘brave’—for us at Filinvest, it’s also about belief. Today’s successful listing of Filinvest REIT is also a solid testament of the faith and belief of investors in Filinvest and what we stand for. While others saw a crisis, Filinvest REIT’s investors saw what we saw: an opportunity to enter the REIT market at an attractive yield. It is an opportunity to participate in the income streams from what has proven to be one of the most resilient industries—the BPO and KPO sector.”
Filreit offered to the public an initial 1.63 billion common shares and another 163.42 million shares covering the greenshoe option in an offer that ran July 26 through August 3. About 70 percent of the offer shares were offered to institutional buyers based in the Philippines overseas, except the United States.
BPI Capital Corp., and UBS AG Singapore Branch served as the joint global coordinators and bookrunners, with BPI Capital as sole local coordinator and local lead underwriter and UBS AG Singapore as the international bookrunner.
BPI Capital is joined by China Bank Capital Corp. First Metro Investment Corp. and SB Capital Investment Corp. in the local underwriting process.
The proceeds raised from the IPO will be used by the company to acquire nine office buildings, three retail buildings, five mid-rise residential buildings, industrial lots, raw land, and expansion of the district cooling system.
“The stock market debut of Filreit during the enhanced quarantine period demonstrates the stability and resilience of real estate investment trust as an asset class. This speaks of the company’s confidence in the quality of its REIT offering and its optimism of the country’s imminent recovery from the pandemic. This confidence can only stem from the sponsor Filinvest Land Inc.’s decades of experience of going through and overcoming economic headwinds and in the process creating an enviable track record in property development and management,” said Ramon S. Monzon, PSE president.
With the new listing, SEC Chairman Emilio Aquino said the Philippines’s REIT market capitalization is estimated to be around P131.1 billion.
“This will represent 0.74 percent of the annualized GDP. That’s 0.81 percent of the total market capitalization and 1.02 percent of the domestic market capitalization. This data implies the Philippine REIT’s potential for growth. REITs in other countries which are already mature markets account for around 3 percent to 7 percent of their GDP,” Aquino said. Around two more REITS are expected to list on the stock exchange this year. These are firms sponsored by Megaworld Corp. and the Gokongwei Group, both of which have already secured regulatory approvals to sell their shares.
Image courtesy of BusinessMirror file photo