MREIT, Inc., the real estate investment trust (REIT) of property developer Megaworld Corp., plans to raise its authorized capital stock to P8 billion from P5 billion to prepare for a possible asset infusion from its sponsor.
MREIT’s board approved the capital increase as well as the issuance and listing of up to 1.36 billion primary common shares in exchange for cash and/or properties, it said in a regulatory filing on Tuesday. These will be up for approval during the annual stockholders’ meeting on Sept. 29.
“Once approved, these measures are expected to pave the way for a significant infusion of prime, income-generating assets, further enhancing portfolio scale and earnings capacity,” MREIT said.
MREIT said the capital increase and share issuance will help reach its target of 1 million square meters (sq.m.) of gross leasable area (GLA) by 2027, three years ahead of schedule.
“When we envisioned MREIT, our goal was to build a REIT that would grow faster and deliver more value than the market expected. Accelerating our 1-million sq.m. GLA target to 2027 aligns with that vision, especially amid a more accommodative global rate environment,” MREIT Chairman Kevin L. Tan said.
“Soon, Megaworld will have close to 1.7 million sq.m. of office GLA and close to 700,000 sq.m. of mall GLA, giving MREIT unparalleled access to a deep pipeline of prime assets,” he added.
Megaworld also aims to grow its office GLA to 2 million sq.m. and its retail GLA to 1 million sq.m. by 2030, bringing the company’s total leasing portfolio GLA to 3 million sq.m.
“The planned infusion of additional assets, subject to stockholder approval, is expected to significantly boost MREIT’s earnings base, dividend-paying capacity, and market presence in the coming years, while cementing its position as one of the largest office REITs in the country,” MREIT said.
The moves came as MREIT reported a 25% increase in second-quarter distributable income to P932 million as revenues rose by 32% to P1.36 billion.
For the first half, MREIT said distributable income rose 26% to P1.86 billion, led by a 28% increase in revenue to P2.7 billion.
The growth was driven by contributions from six newly acquired office properties in 2024, sustained rental escalations, and resilient occupancy levels across the portfolio.
“Our portfolio’s quality, scale, and income resilience give us the confidence to accelerate our plans. We are well-positioned to capitalize on the robust demand for Grade A office spaces and further diversify into complementary asset classes,” MREIT President and Chief Executive Officer Jose Arnulfo C. Batac said.
To date, MREIT’s portfolio comprises 24 prime office properties strategically located in five Megaworld premier townships: Eastwood City, McKinley Hill, McKinley West, Iloilo Business Park, and Davao Park District.
MREIT shares rose by 0.98%, or 14 centavos, to close at P14.48 apiece on Tuesday. — Revin Mikhael D. Ochave
