Daily TribuneThe 153-room resort hotel In El Nido, Palawan caters to leisure tourists, families and social and corporate events; AREIT’s buyout enables it to have a guaranteed building lease from hotel operator, Econorth Resort Ventures, over the next 25 years starting this month
AREIT Inc., the country’s real estate investment trust pioneer, has poured in P1.19 billion for the acquisition of Seda Lio in El Nido, Palawan, from Econorth Resort Ventures Inc., a subsidiary of its sponsor Ayala Land Inc., or ALI.
Seda Lio is a 153-room resort hotel that caters to a variety of clientele, including leisure tourists, families social and corporate events, and other visitors.
AREIT informed the local bourse on Wednesday that the buyout will effectively enable it to earn a guaranteed building lease from the hotel operator, Econorth Resort Ventures, over the next 25 years starting this month.
Annual growth plan
The transaction is part of its annual growth plan, which also includes infusions from ALI, of its flagship buildings in the Makati CBD, Ayala Triangle Gardens Tower 2, Greenbelt wings 3 and 5, Holiday Inn and Suites, and Seda Hotel at Ayala Center Cebu, all worth P21.8 billion.
In addition to the ALI infusions, ACEN acquired a 276-hectare industrial land in Zambales leased by Giga Ace 8 Inc. from Buendia Christiana Holdings Corp. — both wholly-owned subsidiaries of ACEN.
“The acquisition of Seda Lio, alongside the planned asset infusions in 2024, will not only enlarge and expand AREIT’s footprint but also diversify its assets and reduce concentration risk,” said Carol T. Mills, president and CEO of AREIT.
Quadrupling AREIT’s assets under management
“Altogether, this will grow AREIT’s Assets under Management from P87 to P117 billion, quadruple the company’s size when it first listed in August 2020,” Mills said.
Except for Seda Lio, which was bought on a cash basis, the mentioned assets will be acquired through a property-for-share swap with ALI and its subsidiaries, Greenhaven Property Ventures Inc. and Cebu Insular Hotel Co. Inc., subscribing to more than 642 million and BCHC to more than 199 million AREIT primary common shares at an exchange price of P34 per share, as validated by a third-party fairness opinion.
