MANILA, Philippines — Real estate giant Megaworld Corp. is poised to ramp up its development pipeline with the P500 million proceeds from the sale of its shares in real estate investment trust company MREIT Inc.
MREIT president and CEO Kevin Tan said the proceeds from the transaction would be used enhance the company’s development pipeline.
This, in turn, will further expand the opportunities for MREIT, Tan said.
Megaworld sold 40.65 million common shares in MREIT at P12.30 apiece through a block sale transaction.
MREIT said the transaction, representing around 1.5 percent of MREIT’s total outstanding shares, garnered support from a reputable and long-term institutional investor.
The company said all the MREIT shares sold in the transaction are owned by Megaworld and are secondary shares, ensuring that the ownership of existing shareholders of MREIT would not be diluted.
It will likewise increase MREIT’s public float to 44.4 percent, providing further headroom for the oncoming property-for-share swap.
“Following the transaction, Megaworld will maintain a majority stake in MREIT, holding 54.2 percent of the ownership and will remain committed as its sponsor,” Tan said.
“This investment underscores the confidence in MREIT’s potential as an attractive and valuable long-term investment opportunity,” he added.
MREIT signed a memorandum of understanding with its sponsor, Megaworld, in 2023 for the possible acquisition of seven grade A office assets.
The assets have a total gross leasable area (GLA) of 150,500 square meters.
Once completed, MREIT’s portfolio will grow to 475,500 sqm, 46 percent higher from its current 325,000 sqm.
Tan said MREIT is on track to expand its total GLA to 500,000 sqm by end-2024.
“This highlights our commitment to continuously enhancing shareholder value and fostering MREIT’s growth,” Tan said.