Philippine billionaire Lance Gokongwei is making a significant investment in his family’s RL Commercial REIT by injecting about 34 billion pesos worth of shopping malls and offices. This move will allow RL Commercial to narrow the gap with Ayala Land’s AREIT, the largest listed commercial property REIT in the country. Robinsons Land Corp., the Gokongwei family’s property arm, will be selling 11 shopping malls and two offices to RL Commercial in exchange for 5 billion shares priced at 6.80 pesos each. This transaction is expected to be completed by April 2024.
After the transfer of assets, RL Commercial’s portfolio will expand by 72% to a total of 827,808 square meters, bringing it closer in size to Ayala Land’s AREIT, which has approximately 936,000 square meters of leasable space. Jericho Go, the president of RL Commercial, stated that this asset infusion will help diversify the company’s predominantly office asset portfolio by adding mall assets. This move is in line with RCR’s commitment to shareholders to continually grow the company. In a similar transaction in April, Robinsons Land injected 25 billion pesos worth of properties into the REIT.
The latest property-for-share swap between Robinsons Land and RL Commercial will need to be approved by regulatory authorities and shareholders, with completion expected by the end of the year. This deal also provides Robinsons Land with an additional avenue to raise funds for its expansion plans. The company is planning to invest at least 22 billion pesos in expansion initiatives this year, matching the amount deployed in 2023. Despite divesting some assets, Robinsons Land still retains significant property holdings, including shopping malls, office spaces, hotels, and logistics facilities.
In addition to its real estate portfolio, Robinsons Land’s parent company JG Summit also has interests in various sectors, including airlines, food and beverage, banking, petrochemicals, and utilities. The business was founded by the late billionaire John Gokongwei in 1954 as a corn starch factory. Following his passing in 2019, his six children, including Lance Gokongwei, inherited his fortune. The Gokongwei siblings collectively had a net worth of $3 billion, ranking them seventh on the list of the Philippines’ 50 Richest individuals when last published in August of the previous year. The injection of assets into RL Commercial REIT is seen as a strategic move to strengthen the company’s position in the commercial property market and further expand its portfolio.
