Philippine REIT market bullish

The Philippine real estate investment trust (REIT) market is currently experiencing a bullish trend, with investors showing a renewed interest in the sector. This comes as no surprise, given the country’s robust economic growth and the government’s push to promote the REIT market as a viable investment option.

REITs are investment vehicles that allow investors to own a portion of income-generating real estate assets, such as office buildings, malls, and hotels. They are traded on the stock exchange, providing investors with a liquid and transparent way to invest in real estate.

The Philippine REIT market was established in 2009, but it took more than a decade for the first REIT to be listed on the Philippine Stock Exchange (PSE). In August 2020, Ayala Land, one of the country’s largest property developers, launched the first REIT in the Philippines, raising PHP 13.6 billion ($280 million) in its initial public offering (IPO).

Since then, the Philippine REIT market has gained momentum, with more companies expressing interest in launching their own REITs. In December 2020, Robinsons Land Corporation filed an application with the Securities and Exchange Commission (SEC) to launch its own REIT, which is expected to raise up to PHP 26.7 billion ($550 million).

The bullish trend in the Philippine REIT market can be attributed to several factors. Firstly, the country’s real estate sector has remained resilient despite the pandemic, with demand for office and residential spaces remaining strong. Secondly, the government has implemented several measures to promote the REIT market, such as reducing the minimum public ownership requirement from 67% to 33%, and exempting REITs from value-added tax (VAT) and documentary stamp tax (DST).

Moreover, the low interest rate environment has made REITs an attractive investment option for investors seeking higher yields. REITs typically offer higher dividend yields than traditional stocks, making them an ideal investment for income-seeking investors.

In conclusion, the Philippine REIT market is poised for growth, with more companies expected to launch their own REITs in the coming months. The market’s bullish trend is a testament to the country’s strong economic fundamentals and the government’s commitment to promoting the REIT market as a viable investment option. As such, investors should consider adding REITs to their investment portfolio to take advantage of the potential growth opportunities in the Philippine real estate sector.