CREIT acquiring P2.5 billion assets

MANILA, Philippines — Citicore Energy REIT Corp. (CREIT) will acquire two assets for P2.5 billion to boost its portfolio.

This will allow CREIT to grow its revenues by over a fifth.

In a disclosure to the Philippine Stock Exchange, CREIT said its board approved the acquisition of the Bulacan and South Cotabato properties under the Citicore Group and the subsequent execution of lease agreements.

The company is acquiring the Bulacan property for P1.75 billion and the South Cotabato property for P753.8 million, for a total of P2.51 billion.

“Upon acquisition, CREIT will be generating leasing income from these properties over a long- term period of 25 years, adding 20 percent to its total leased area,” the company said.

“The two properties will contribute 21 percent to CREIT’s total lease revenues and bring total operating capacity of all its tenants to 145 MWdc from pre-initial public offering’s (IPO) capacity of 124 MWdc,” it said.

CREIT said Cuervo Appraisers Inc. (Cuervo), an independent accredited appraiser of the Securities and Exchange Commission, was engaged as a third-party consultant to provide a fair market valuation of the said properties.

“The assets were valued using Income Approach adopting the discounted cash flow method based on a weighted average cost of capital (WACC) using the capital asset pricing model. The direct capitalization approach was also used as secondary method to cross-check the value of the properties,” CREIT said.

An asset of Citicore Solar Bulacan Inc., the San Ildefonso, Bulacan property has an aggregate area of 253,880 square meters and is the site of an operating 15-megawatt peak (MWp) solar power plant commissioned in March 2016.

Meanwhile, the South Cotabato property in Surallah municipality has an area of 79,997 square meters and a 6.23-MWp solar power plant which started operating in December 2015, It is under Citicore Solar South Cotabato Inc.

In a separate announcement, CREIT said it declared dividends of P0.035 per share, representing 102 percent of the distributable income for 2021.

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The article was originally published in PhilStar Global and written by Danessa Rivera.