MREIT Inc., the real estate investment trust of Megaworld Corp., is all set to diversify from being one of the country’s largest office landlords by expanding its portfolio to include malls and a hotel.
The company said Friday that it had signed a memorandum of understanding with parent firm Megaworld, Travelers International Hotel Group Inc. and Southwoods Mall Inc. for the potential acquisition of 12 income-generating assets with a combined gross leasable area of about 303,500 square meters (sqm).
The planned transaction, part of MREIT’s “Wave 5” expansion, will increase the company’s total portfolio by 47 percent, from 647,000 sqm to around 950,000 sqm upon completion.
“This transaction transforms MREIT from an office REIT into a diversified REIT, anchored by some of the most iconic mall and lifestyle assets in the country,” MREIT Chairman Kevin Tan said.
The assets identified for infusion include five malls, six Grade A office buildings and one internationally branded hotel located across Megaworld townships.
The mall properties are Eastwood Mall in Quezon City, Venice Mall in Taguig, Lucky Chinatown Mall in Manila, Festive Walk Mall in Iloilo and Southwoods Mall in Laguna.
The office assets, meanwhile, are Science Hub Tower 2 and Venice Corporate Center in McKinley Hill, Six West Campus in McKinley West, One Paseo in Pasig, Global One in Eastwood City and Horizon Center in Newport City.
The hospitality component involves Holiday Inn Express Manila in Newport City, which will become MREIT’s first hotel asset.
Once completed, MREIT’s portfolio mix is expected to shift from more than 95 percent office assets at present to about 77 percent office, 20 percent retail and 3 percent hospitality.
The Wave 5 portfolio was said to have a combined occupancy rate of about 92 percent and a weighted average lease expiry of 5.8 years, longer than MREIT’s current portfolio average of 3.1 years.
MREIT President and CEO Jose Arnulfo Batac said the transaction would be structured to remain immediately accretive to dividends per share.
The REIT said the transaction remained subject to due diligence, final valuation and regulatory approvals, with definitive agreements targeted within the second half of 2026.
To support the planned infusion, MREIT’s board endorsed for shareholder approval the issuance of up to 1.8 billion primary common shares to be used in property-for-share swaps during the company’s annual stockholders’ meeting on Thursday.
Since its listing in 2021, MREIT has expanded its portfolio from 224,000 sqm to 647,000 sqm through four prior asset infusion waves.
The company’s shares held steady at P13.80 each on Friday amid a 1.56-percent drop for the benchmark Philippine Stock Exchange index.
