Filinvest REIT Corp. Declares Second Quarterly Dividends to Shareholders, Registered a Net Income of P304 Million in Q12024

The Board of Directors of Filinvest REIT Corp. (FILRT) approved the dividend declaration to all stockholders, which amounts to P0.062 for each outstanding common share. According to the closing share price on May 9, 2023, this declaration raises the year-to-date dividends to P0.129 per outstanding common share, or an annualized yield of 9.0%.

To stockholders on file as of May 24, 2024, the quarterly cash dividends will be paid on June 7, 2024. In the first quarter of 2024, the dividend declaration denotes a 100% distribution of the P304 million distributable income.
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Due to persistent challenges with office building occupancy, FILRT's first quarter 2024 revenues of P725 million represented a 10% decrease from the same period in the previous year. On the other side, due to the additional commissions paid to secure new leases, costs and expenses increased by 2% to P325 million. In the first quarter of 2024, FILRT reported P304 million in net income.
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​In the first quarter of 2024, the average occupancy of FILRT's portfolio, which consists of 17 office buildings and one resort lot totaling 330,448 square meters, was 79%, which was less than the average occupancy of 83% in 2023. The decline is the result of some BPO tenants downsizing, opting for work-from-home and hybrid work arrangements, and non-renewals or pre-terminations. Two of these BPO tenants do not have any other agreements with developers; they are just tenants of FILRT. In Alabang, where 16 of the 17 buildings are located, FILRT maintained an advantage over the competition despite the difficulties. In contrast to Colliers International's estimated 70% market occupancy in Alabang for its Q1 2024 office market report, FILRT recorded a higher occupancy rate.

“In terms of occupancy, we believe that we have already seen the bottom. We are optimistic that leasing activities will start to turn around and gradually improve in the next quarters. We have managed to find immediate replacement tenants amid a challenged office market,” said Ms. Maricel Brion-Lirio, President and CEO of FILRT. “As we recover and rebuild the tenancy of our office buildings, we are also steadfast in our goal to expand our portfolio in order to increase dividends for our shareholders in the long term,” she added. 

FILRT keeps concluding new leases and extending contracts that are about to expire. Nearly 14,700 square meters of new leases have signed Letters of Intent and Contracts of Lease as of the end of April 2024. In the upcoming months, this will cause the occupancy rate to rise to 83%. Negotiations are underway for an additional 8,000 square meters, primarily with multinational BPO companies.
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Regarding tenant retention, out of the 56,986 square meters whose leases expire in 2024, almost 20,000 square meters, or 35%, have already been renewed, and another 6,109 square meters, or 11%, are pending the completion of the renewal agreements. The balance of the contracts comes up for renewal throughout the course of the remaining year, with only 5,278 square meters, or 9%, choosing not to renew. The occupancy already accounts for the non-renewals.

FILRT has carefully diversified its tenant mix by including both traditional tenants and co-working locators as part of its objectives. The current tenant mix is made up of 11% hospitality, 12% typical office and co-working spaces, 76% international BPO businesses, and a tiny amount of retail space. There is no POGO exposure for FILRT.

As part of its dedication to sustainability and in response to tenants' increasing need for environmentally friendly workspaces, FILRT has led the way in introducing green features into its portfolio. FILRT has said that it has successfully shifted five more of its office buildings to renewable energy. This indicates that 76% of its portfolio, or 13 office buildings, are now powered by renewable energy. By June, this is anticipated to rise even higher to 94%. In addition, FILRT actively pursues green certifications. Two of the FILRT's buildings are LEED Gold certified, while seven of the properties have earned certifications under the EDGE (Excellence in Design for Greater Efficiency) program. These awards highlight FILRT's dedication to sustainability and the use of environmentally friendly resources.
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At the annual ASEAN Corporate Governance Scorecard (ACGS) Golden Arrow Awards, presented by the Institute of Corporate Directors (ICD), FILRT was honored for its outstanding commitment to regional corporate governance norms. In recognition of its dedication to the highest standards of corporate governance, FILRT was awarded a 1-Golden Arrow.

​One of the biggest real estate developers in the Philippines, Filinvest Land, Inc., is the sponsor of Filinvest REIT Corp. (FILRT), a real estate investment trust (REIT) corporation with a well-established portfolio of residential, office, retail, and industrial developments around the nation.

FILRT was publicly listed on the Philippine Stock Exchange on 12 August 2021 as the Philippines’ first sustainability-themed REIT. Its original portfolio consists of 17 Grade A and LEED Gold certified office buildings which include green and sustainability-themed features. An addition to the portfolio is 2.9 hectares of land that is being leased to the owner and operator of Crimson Resort & Spa Boracay.

Totaling over 330,000 square meters of gross leasable area, 16 of the buildings are in Northgate Cyberzone in Filinvest City in Alabang. Filinvest City is a 244-hectare mixed-use and integrated city that is the first and only central business district in the Philippines to receive LEED® (Leadership in Energy and Environmental Design) v4 Gold for Neighborhood Development Plan certification as well as a three-star BERDE (Building for Ecologically Responsive Design Excellence) certification. Another building is Filinvest Cyberzone Cebu Tower 1 located in the gateway of Cebu IT Park in Lahug, Cebu City.