MREIT Q1 earnings rise 12%

MREIT, Inc., the real estate investment trust of Megaworld Corporation, reported a 12 percent growth in distributable income to P713 million in the first quarter of 2023 compared to the same period a year ago.

In a disclosure to the Philippine Stock Exchange, the firm said its growth was driven by the successful acquisition and consolidation of the P5.3 billion worth of assets which began contributing to MREIT’s income starting January 1, 2023.

It added that, this was also the reason its revenues improved by 15 percent to P1.0 billion from the P901million recorded in the first quarter of last year.

Following the results of the first quarter of 2023, MREIT declared dividends of P0.2476 per share to its shareholders based on its distributable income. The cash dividends will be payable on June 19, 2023 to shareholders on record as of May 29, 2023.

Annualized, this brings MREIT’s dividend yield to 6.8 percent as of the closing share price of P14.66 per share on May 11, 2023.

The new assets increased MREIT’s gross leasable area by 16 percent to 324,700 square meters and includes four prime, Grade A and PEZA-accredited office properties in McKinley West and Iloilo Business Park.

This solidifies MREIT’s position as the sole REIT in the market with a noteworthy presence in Fort Bonifacio, Taguig City.

“We have achieved another milestone for MREIT as we finally closed our promised acquisition,” said MREIT President and Chief Executive Officer Kevin L. Tan.

He added that, “As we move forward, we remain focused on our core strategies of acquiring high-quality assets and delivering sustainable income to our investors, as are now working for the next stage of growth for MREIT.”

MREIT’s average occupancy rate as of end-March 2023 is at 95 percent, significantly higher than the broader office industry’s average occupancy rate of 80-81percent. This affirms the quality of MREIT’s assets.

The firm’s tenant base is comprised mostly of sticky tenants such as BPOs and traditional offices. Of the occupied space, 77 percent are BPO tenants, while 17 percent are traditional office tenants.

“The office industry is resilient and remains an important growth story for our nation. We believe the remaining challenges are only temporary and we look to be on the forefront of oncoming demand, especially from the growing BPO industry,” noted Tan.

Since its IPO, the company managed to grow its portfolio value by 25 percent to P62 billion after two sets of acquisition.

Moving forward, MREIT will continue to actively explore new opportunities to acquire assets in strategic locations that have attractive long-term growth prospects. The company is committed to double its portfolio GLA to 500,000 square meters by 2024.

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The article was originally published in Manila Bulletin and written by James A. Loyola.