RLC’s REIT eyes more mall, office asset infusions

MANILA, Philippines — Gokongwei-led RL Commercial REIT Inc. (RCR) is looking at adding more mall and office assets of its sponsor Robinsons Land Corp. (RLC) to bolster its portfolio in the near term, as the infusion of hotels is expected to still take a while.

RCR treasurer and director Kerwin Tan said a three-year target has been mapped out to make RCR, the country’s largest real estate investment trust in terms of geographical reach, “as big as possible.”

“Actually when you look at the sponsor’s assets, the current assets that are in RCR right now from the sponsor is just I think one-third of the sponsor’s assets. So potentially, RCR can grow two-thirds of the assets from the sponsor more. So it’s basically three times more from the current size, potentially,” he said.

Tan, who also serves as chief financial officer of RLC, said the asset infusions would all depend on market conditions as well as other factors.

RCR is present in 18 key cities and locations across the country, with 29 assets composed of 17 office assets and 12 mall assets.

RCR said its sponsor, RLC, still has over 1.3 million square meters of malls gross leasable area (GLA), more than 250,000 sqm of offices GLA, almost 300,000 sqm of logistics GLA and approximately 4,000 hotel room keys that may be infused into the company in the future.

“Our fund management company actually evaluates all the assets for the sponsor and looks at which is the more beneficial for RCR shareholders and I think for the hotels, it will take a while before the hotels can be infused because of course, we want the best assets to be infused into RCR, so it will depend on its occupancy,” Tan said.

Aside from asset infusions from RLC, RCR is also on the lookout for potential assets for acquisition from third parties.

RLC’s recent overnight block placement of its RCR shares amounting to P6.21 billion paves the way for RCR to expand its portfolio.

With the placement, RCR’s public float increased to 6.69 billion common shares or 42.57 percent of the total issued and outstanding common shares.

“So this will pave the way for the sponsor to infuse more assets depending on the recommendation of our fund management company,” Tan said.

Leveraging its successful REIT platform, RCR, RLC continues to recycle capital through property infusions and strategic share sales.

To further increase its portfolio, RLC said it aims to proportionately replenish assets sold to RCR to unlock value for shareholders.