MANILA, April 24 (Reuters) - Philippine property developer Ayala Land Inc is looking to raise $500 million in the country’s first real estate investment trust (REIT) offering, officials said on Wednesday.
A law allowing REITs was passed in 2009 but property firms shied away from it because of what was then seen as high public ownership requirement and unfavourable tax rules.
“We are testing the framework. We will start with a few assets only, primarily Makati central business district assets, basically offices,” Ayala Land Senior Vice President Jose Emmanuel Jalandoni told a news briefing.
Ayala Land is a unit of Ayala Corp, the Philippines’ oldest conglomerate, which has interests ranging from retail, wind and solar energy and telecoms to banking, healthcare, automotives and utilities.
Ayala Land’s REIT firm can be used to acquire office assets in the Philippines’ main financial hub, said company’s President Bernard Vincent Dy.
The Makati business district, located at the heart of the Philippine capital, is the crown jewel of Ayala Land, which is valued at $13.3 billion.
REITs manage real estate assets that regularly generate profits that are distributed to shareholders as dividends.
Ayala Land will sell to the public 67 percent of the REIT company, Dy said, adding it will hire sister firm Bank of the Philippine Islands as underwriter for the offering set this year.
Shares in Ayala Land were up 1.91 percent to a record high during noon break, when the REIT plan was announced.
Reporting by Neil Jerome Morales; Editing by Rashmi Aich