Megaworld’s P27-B asset infusion is year’s biggest REIT industry deal

Insider Spotlight

• MREIT is moving toward closing its P27-billion Wave 5 asset infusion after securing SEC approval, the largest REIT asset infusion announced so far in 2026.
• The transaction lifts MREIT's total asset infusions this year to more than P43 billion, including the earlier Wave 4 deal.
• The acquisition expands MREIT's portfolio to about P122 billion in assets under management while increasing its exposure to retail and hospitality.

Megaworld’s MREIT Inc. is moving to complete its P27-billion Wave 5 property-for-share swap after obtaining regulatory approval, positioning the transaction as the largest asset infusion by a Philippine real estate investment trust this year.

The Securities and Exchange Commission's approval clears the way for MREIT to finalize the acquisition, which will raise its assets under management to about P122 billion. Together with the P16.2-billion Wave 4 transaction completed earlier this year, the company's asset infusions in 2026 now exceed P43 billion.

Why it matters

The transaction adds about 303,900 square meters of gross leasable area, expanding MREIT's portfolio to more than 950,000 square meters and bringing it closer to its target of exceeding one million square meters by 2027.

It also marks MREIT's biggest portfolio diversification to date. Once completed, the REIT's portfolio mix will shift from being more than 95 percent office to roughly 77 percent office, 20 percent retail and 3 percent hotel, while expanding its presence from five to nine Megaworld townships.

Jose Arnulfo Batac

The MREIT chief said the deal shows the firm's ability to translate Megaworld assets into shareholder value.

By the numbers

The Wave 5 portfolio includes five lifestyle malls, the 737-room Holiday Inn Express Manila Newport City and six office properties. The assets carry a blended occupancy rate of 91 percent and a weighted average lease expiry of 5.3 years, providing a broader base of recurring rental income.

The assets were valued at a blended effective cap rate of 7.8 percent. Shares to be issued under the transaction were priced at P16.50 each, an 18.6 percent premium to MREIT's 30-day volume-weighted average price before board approval, a structure the company said minimizes dilution and supports dividend-per-share accretion.

What's next

MREIT Inc. president and CEO Jose Arnulfo Batac said, "Wave 5 demonstrates MREIT's ability to translate the depth of Megaworld's sponsor pipeline into tangible shareholder value. With SEC approval secured within the third quarter and the assets contributing income effective July 1, shareholders stand to benefit from the transaction's material dividend-per-share accretion from the outset."

Following Wave 5, MREIT is preparing its next round of acquisitions under Wave 6, which could include select assets in Uptown Bonifacio, subject to due diligence, valuation, corporate approvals and regulatory clearances.

— Edited by Daxim L. Lucas