September 10, 2024 | 12:00am
MANILA, Philippines — AREIT Inc., the listed real estate investment trust of the Ayala Group, has raised P43 million from the sale of condominium units to fund the acquisition of a resort hotel in Palawan.
In a stock exchange filing, AREIT said it executed a deed of absolute sale with Next AsiaLand Inc. for three office condominium units at Ayala-Life FGU Center Alabang.
The condo units with an aggregate gross floor area of 339 square meters were sold by AREIT for P42.7 million.
AREIT plans to invest the proceeds to finance the acquisition of Seda Lio, a 153-room resort-hotel in El Nido, Palawan.
The company earlier announced the completion of its acquisition of Seda Lio from Ayala Land Inc. (ALI)’s subsidiary Econorth Resort Ventures Inc. for P1.19 billion.
With the acquisition, AREIT will earn a guaranteed building lease from the hotel operator, Econorth Resort Ventures, over the next 25 years beginning January 2024.
Seda Lio caters primarily to leisure tourists, families, social and corporate events, among others.
The transaction is part of AREIT’s growth plans, which includes infusions from its sponsor, ALI.
The company is ramping up its asset diversification to accelerate growth in the coming years.
Under the leadership of new president and CEO Jose Eduardo Quimpo II, AREIT will diversify its asset mix with a portfolio of offices, malls, hotels and industrial assets to improve returns and reduce sector risks across various economic cycles.
At present, offices account for about two-thirds of AREIT’s portfolio.
AREIT is set to close the year with $2 billion in assets under management and is poised to hit its $3 billion target within the next three years.
The company finished the first half with a net income of P2.9 billion, up 44 percent year-on-year, on the back of a 43-percent surge in revenues to P4.2 billion.
Its overall occupancy remained high at 96 percent during the period, better than the industry average.
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