Deal terms
Filinvest REIT, whose portfolio mainly consists of office buildings, said on Monday, Jan. 27 it will purchase the property by issuing 1.62 billion shares to controlling stockholder Filinvest Land at P3.85 per share, a stock exchange filing on Monday showed.
This is 25 percent higher than Filinvest REIT’s closing price of P3.08 per share before the deal was announced. Filinvest REIT gained 1.95 percent to P3.14 each on Monday morning.
The share issuance to Filinvest Land will also increase the latter’s stake in Filinvest REIT from 51.06 percent to 63.27 percent.
Big picture
Filinvest REIT is a real estate investment trust, which is a dividends-focused property holding company.
The acquisition of the Festival Mall “main mall” is part of a strategy to diversify its portfolio from office spaces to commercial retail, a resilient segment that performed well in the post-pandemic period.
This is similar to moves made by other REITs such as AREIT, MREIT, and RL Commercial REIT.
Filinvest REIT lags its peers in terms of returns, with its share price on Friday down 56 percent from its IPO value, according to the Merkado Barkada REIT Index.
Festival Mall is one of the country’s biggest shopping malls
According to the filing, the Festival Mall main mall has a gross leasable area of 121,862 square meters.
It opened in 1998 in the wake of the Asian financial crisis—a risky move during challenging times.
It is now one of the top malls in southern Metro Manila, with over 1,000 stores.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
