Another real estate investment trust (Reit) is coming to the Philippine Stock Exchange (PSE) after the Securities and Exchange Commission (SEC) approved the initial public offering (IPO) of VistaREIT, which aims to raise up to 9.178 billion pesos (US$175 million).

In its meeting on May 5, the SEC resolved to render effective the registration statements of VistaREIT covering 7.5 billion common shares, subject to its compliance with certain remaining requirements.

VistaREIT is sponsored by companies led by real estate tycoon Manuel Villar, namely Masterpiece Asia Properties, Manuela Corporation, Vista Residences, Crown Asia Properties and Communities Pampanga. The company will offer up to 3.34 billion shares at a price of up to 2.50 pesos per share, with an overallotment option of up to 333.75 million shares.

The shares, currently owned by the sponsors, will be listed and traded on the main board of the PSE. Assuming the overallotment option is fully exercised, VistaREIT will net 8.79 billion pesos from the IPO.

The sponsors will receive the entire proceeds of the offer, which shall be reinvested in the Philippines, pursuant to the revised implementing rules and regulations of the REIT Act of 2009. New investors will corner 48.95% of the issued and outstanding shares of VistaREIT, while existing shareholders will retain the remaining 51.05%, should the company exercise the oversubscription option.

As mandated by law, VistaREIT shall distribute to shareholders at least 90% of its annual distributable income as dividends. The distributable income refers to the company’s net income as adjusted for unrealized gains and losses/expenses and impairment losses, and other items in accordance with internationally accepted accounting standards. It excludes proceeds from the sale of the Reit’s assets that are reinvested in the Reit within one year from the date of the sale.

VistaREIT expects to conduct the IPO from May 10 to 16 and debut on the PSE on May 26. BDO Capital & Investment Corporation, China Bank Capital Corporation, PNB Capital and Investment Corporation, RCBC Capital Corporation and SB Capital Investment Corporation are mandated as joint lead underwriters for the offer, with Abacus Capital and Investment Corporation appointed as a participating underwriter.

The current portfolio of VistaREIT includes 10 community malls and two office buildings with a gross leasable area of 256,403.95 square metres. The company’s malls are located in Metro Manila and in the provinces of Cavite, Rizal, Bulacan, Pampanga and Cebu, while its office buildings are in the cities of Taguig and Bacoor in Cavite. The company has tapped VProperty Management as property manager and VFund Management as fund manager of the Reit.

At present, there are five listed Reits at the PSE, namely AREIT, DDMP REIT, Filinvest REIT, RL Commercial REIT and MREIT.