Megaworld to add 250,000 sq.m. to MREIT

LISTED property developer Megaworld Corp. is planning to inject additional office and retail assets into its real estate investment trust MREIT, Inc. next year.

“We’ll add another 250,000 square meters of mostly malls and offices,” Kevin Andrew L. Tan, president and chief executive officer of parent firm Alliance Global Group, Inc. (AGI), told reporters last week.

Megaworld Investor Relations Head Andy Dela Cruz said the company plans to infuse office assets first, followed by mall assets by the second.

The company plans to inject 10 office assets into MREIT, with a valuation of at least P15 billion.

“We are currently reviewing all the malls under Megaworld, because the goal is really to infuse everything, step by step,” Mr. Dela Cruz said.

MREIT is targeting to expand its asset portfolio to one million square meters (sq.m.) of gross leasable area (GLA) by 2027.

“By 2030, Megaworld will have three million square meters in total — two million square meters in offices, and one million square meters in retail. So by 2030, there’s at least 2 million square meters more that we want to put,” Mr. Dela Cruz said.

At present, MREIT’s properties are located within Megaworld’s townships, including Eastwood City, McKinley Hill, McKinley West, Iloilo Business Park, and Davao Park District.

Mr. Dela Cruz said Megaworld had launched P20 billion worth of projects as of end-September, already meeting its full-year target.

“For the remainder of the year, we’re studying the real estate market demand, and we’re ready to launch anytime there’s demand,” he said.

Megaworld expects firm demand across its office, retail, and hotel segments to support full-year performance, Mr. Tan said.

“I think this year is still going to be growth because we had a very good start of the year, and I think the demand continues to be strong. But of course, there’s a lot of wait and see among our clients,” he added.

Mr. Tan also said AGI, Megaworld’s parent conglomerate, is on track to post growth this year.

“There’s been some recovery in the retail core business. Travellers [International Hotel Group, Inc.] also is experiencing some growth this year, so I think overall, AGI [growth] will be good as well,” he said.

“I just think that maybe if ever there’s a little bit of headwinds on the liquor side.”

AGI’s core businesses include real estate development, tourism-entertainment and gaming, and food and beverage through its liquor unit Emperador, Inc.

AGI posted a 24% increase in nine-month net income to P24.8 billion, with Megaworld contributing the most after its net profit attributable to parent company rose 16% to P15.9 billion.

Meanwhile, MREIT reported a 27% increase in distributable income to P2.8 billion as of end-September following the acquisition of additional office assets.

On Friday, Megaworld Corp. shares fell by one centavo or 0.49% to close at P2.04 apiece. — Beatriz Marie D. Cruz