Property developer Kepwealth Property Philippines. Inc. hesitates on spending the full proceeds of its initial public offering and deploy them temporarily instead on low-risk investments for when post-pandemic opportunities get more defined.
Originally looking to complete such acquisitions in mid-2020, it projects acquiring properties between now through next year as the challenges brought by the pandemic persist.
“As has been our stance since the beginning of the pandemic, we still believe our shareholders’ interest is best served by being conservative in our capital investments. In the meantime, all unused IPO (initial public offering) proceeds were invested in a low risk investment instruments with the highest returns as possible,” the company said.
The Cebu-based property development enterprise said the prudent stance is to “proceed cautiously as we evaluate the available properties and weigh that against the demand for office spaces.”
It said the pandemic has adversely affected its clients and its leasing operations even as it works to help them keep afloat and find new clients at the same time.
It earlier bought two floors and 18 parking spaces in One San Miguel Avenue in Mandaluyong that were only turned-over after the community quarantine restrictions were lifted.
As of the first half, Kepwealth still has to deploy P170.45 million of the P384.76 million in gross IPO proceeds from its August 2019 debut, particularly those allotted for Metro Manila.
The pandemic and the financial difficulty that followed forced clients to pre-terminate their asset management contracts with the company, Kepwealth said.
The company owns 77 office condominium units with 98 leasable spaces at Kepwealth Center, a commercial building at the Cebu Business Park.
The PEZA-accredited 15-storey building is rented by reputable domestic and multinational firms in finance and insurance, audit, legal counseling, education, health services, real estate, tourism, and sovereign agencies, among others.
