MREIT Inc., the real estate investment trust arm of Megaworld Corp., posted its strongest quarterly performance to date in the first quarter, as a recently completed acquisition and improved operating efficiency combined to drive broad based growth in earnings, revenues, and margins.
Distributable income rose 34 percent year on year to P1.25 billion, outpacing a 29 percent increase in revenues to P1.72 billion. The faster growth in earnings reflects stronger operating leverage as the company scales up its office portfolio. Net operating income margin also improved to 81.6 percent from 80.3 percent a year earlier, supported by cost discipline and higher quality rental income.
A major driver of the results was the Wave 4 portfolio infusion, a P16.2 billion property for share swap approved by regulators in March. The transaction added nine Grade A office buildings in McKinley Hill, occupied largely by multinational tenants, expanding MREIT’s gross leasable area by about 34 percent to roughly 647,000 square meters. Importantly, income contribution was applied retroactively from January 1, allowing shareholders to benefit immediately from the enlarged asset base.
MREIT president and chief executive officer Jose Arnulfo C. Batac said the numbers reflect the intended effect of the acquisition. He noted that the margin expansion highlights the operating leverage of a larger and higher quality portfolio, reinforcing what he described as disciplined and accretive growth that strengthens the company’s earnings base going forward.
With Wave 4 now fully integrated, attention is shifting to Wave 5, which is expected in the second half of 2026 and will introduce retail assets into the portfolio through mall property infusion. The planned expansion is subject to due diligence, valuation, and regulatory approvals, but is seen as a key step toward MREIT’s target of reaching one million square meters of gross leasable area by 2027.
The company’s portfolio is anchored on prime assets within Megaworld townships such as McKinley Hill, McKinley West, Eastwood City, Iloilo Business Park, and Davao Park District. Backed by Megaworld’s development pipeline and the broader asset base of Alliance Global Group, MREIT continues to position itself as one of the more aggressively expanding sponsor supported REITs in the Philippines, with visibility on further asset injections supporting its growth trajectory.
