Filinvest Land—controlled by billionaire Mercedes Gotianun and her family—is raising up to 14.9 billion pesos ($319.6 million) from the initial public offering of their office real estate investment trust, cashing in on the boom in demand for space from business processing outsourcing (BPO) companies.
The IPO was approved by country’s Securities and Exchange Commission on Tuesday. Filinvest REIT Corp. plans to sell as much as 1.8 billion shares—including an overallotment option of up to 163.4 million shares—at a maximum price of 8.30 pesos a piece.
Filinvest REIT will own and manage a portfolio of 16 office buildings in the Northgate Cyberzone, an IT industrial park developed by Filinvest Land in the southern Manila suburb of Alabang, as well as an office tower in the Cebu Cyberzone in the central Philippine island of Cebu. About 88% of the properties—with a gross leasable area of 301,362 square meters—are occupied by BPO companies, or call centers, which are among the most resilient assets in the country, according to Filinvest Land.
Philippine real estate developers have been cashing in on the rising demand for office space from BPO companies, with the country’s first listed REITs—Ayala Land’s AREIT and tycoon Edgar Sia’s DDMP REIT—also backed by properties catering to such companies. The assets are resilient despite the pandemic, with Filinvest REIT’s revenues from its 17 office buildings rising 8% to 3.1 billion pesos in 2020 compared to the previous year.
Other developers which plan to list their office and commercial REITs this year include the Gokongwei’s Robinsons Land, tycoon Andrew Tan’s Megaworld, and Vista Land, controlled by Manuel Villar (No. 2 on the Philippine Rich List).
For Filinvest Land, the listing of its office REIT provides the group a vehicle to realize the underlying value of its vast network of office and industrial parks across the country.
“REIT is a new financial platform to monetize our investment assets as they mature and provide funding to fuel future growth,” Filinvest Land president and CEO Josephine Gotianun-Yap said at the company’s annual shareholders’ meeting in April. “The fair market value of all our investment projects both existing and under construction is 190 billion pesos based on the appraisals of third parties.”
Yap is the daughter of the late real estate tycoon Andrew Gotianun, who founded Filinvest with his wife Mercedes in 1955. Mercedes had a net worth of $1.5 billion when the Philippine Rich List was last published in September. The Gotianuns also have interests in hospitality, sugar, banking and infrastructure.