“Indeed, the company remains committed to delivering value to its shareholders,” VREIT said in response to an article by InsiderPH on Oct. 7, 2025.
The piece also cited data from VREIT’s financial reports and Abacus Securities research head Nicky Franco, who flagged the rising receivables, which amounted to about P5.4 billion as of June this year.
Shares of VREIT have plunged 31 percent this year.
VREIT says most receivables not from overdue rent
In its statement, VREIT said “the majority of the company’s receivables pertain to future rental escalations.”
“These amounts are not yet due and will only be billed upon the application of the relevant escalation rates, in accordance with the terms of our lease agreements,” it added.
The company did not provide a breakdown of how much was due.
Revenue–cash timing recognition
“As required under Philippine Accounting Standards (PAS) 17, rental income is recognized on a straight-line basis over the lease term, which includes future escalation amounts,” VREIT continued in its statement.
“This results in a timing difference between revenue recognition and actual cash collection, as a portion of the revenue recognized consists of unbilled rental income tied to future rent increases. Since these are contractually guaranteed and not yet due, no allowance for doubtful accounts is recorded against them,” it added.
VREIT uses straight-line accounting, which spreads rental income evenly over the lease term, even if tenants haven’t paid yet, creating a gap between reported revenue and actual collections.
It’s similar with Ayala Land-backed AREIT, which also reports large receivables, although Franco said this was less of a concern since the latter classifies many of its contracts as finance leases.
VREIT assures continued payouts
VREIT is assuring investors that collections remain sound and that its accounting practices have no impact on dividend payouts.
“These accounting treatments do not affect the company’s distributable income or its ability to pay dividends. Items such as receivables related to future rental escalations, along with fair value gains or losses, are excluded from distributable income calculations,” it said.
“As such, they have no bearing on the dividends declared,” it added.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
