VistaREIT Inc., the real estate investment trust of the Villar Group, is looking at new acquisitions, primarily among the assets of Vista Land & Lifescapes, in line with its investment goal of doubling the gross floor area of its current property holdings to over 500,000 square meters by 2025.
In a three-year investment strategy drawn up by VREIT’s fund manager VFund Management Inc. and disclosed to the Philippine Stock Exchange on Friday, the listed real estate investment trust expects prospective acquisitions and organic growth to support its goal of providing “at least a 10 percent annual total shareholder return.”
The prospective investments, according to its plan, will double the gross floor area that stood at 256,403 square meters of its real estate holdings before it launched its initial public offering last year. Its real estate holdings, with an appraised value of P35.95 billion, is comprised of two office buildings and 10 shopping malls acquired from Vista Land through a property-for-swap swap.
Vista Land owns 64.64 percent of VREIT while public investors own a total 35.29 percent.
VFund’s three-year strategy allows for VREIT’s acquisition outside of the Vista Land developments as long as the asset meets certain criteria, including location, stable occupancy rate, and quality tenants, especially those that focus on essential goods and services.
VREIT intends to fund these acquisitions through a combination of equity and debt. With a gearing ratio of zero, the company could borrow up to the 35 percent leverage limit to fund acquisitions and enhance shareholder value.
At the end of September, VREIT has already distributed as cash dividend a total P428.3 million, or nearly 99.9 percent of its distributable income. That represents an annualized dividend yield of 9 percent as of September.
VREIT listed on the PSE on June 15 at P1.75, the offer price of its shares.
