RL Commercial REIT Inc. Expands its Portfolio Via a Property-for-Share Swap with Robinsons Land Corporation

In a PSE disclosure dated, July 17, 2024, the third property-for-share swap transaction of RL Commercial REIT Inc. (RCR) with its Sponsor, Robinsons Land Corporation (RLC) has been consummated through the execution of a Deed of Assignment for the infusion of thirteen (13) commercial assets totaling to 347,329 square meters (sqm) of Gross Leasable Area (GLA) with a total appraised value of Thirty-Three Billion Nine Hundred Fifteen Million Nine Hundred Sixty Thousand Pesos (P33,915,960,000.00) in exchange for Four Billion Nine Hundred Eighty Seven Million Six Hundred Forty One Thousand One Hundred Seventy Eight (4,987,641,178) primary common shares of RCR at a price of P6.80 per share.

The Transaction was approved by RCR’s Board of Directors on June 5, 2024 and its shareholders at the Special Shareholders Meeting held on July 15, 2024.

​Properties Subject of Property-For-Share Swap:

• Robinsons Luisita - 15,779.54 sqm of GLA located at Tarlac City, Tarlac;
• Robinsons Sta. Rosa - 26,931.76 sqm of GLA located at Sta. Rosa City, Laguna;
• Giga Tower - 53,398.15 sqm of GLA located at Bridgetowne, Quezon City;
• Cybergate Davao - 10,841.09 sqm of GLA located at Davao City, Davao Del Sur;
• Robinsons Imus - 37,376.22 sqm of GLA located at Imus City, Cavite;
• Robinsons Los Baños - 5,317.39 sqm of GLA located at Los Baños City, Laguna;
• Robinsons Lipa - 43,692.11 sqm of GLA located at Lipa City, Batangas;
• Robinsons Cabanatuan - 15,811.00 sqm of GLA located at Cabanatuan City, Nueva Ecija
• Cybergate Delta 2 - 15,404.63 sqm of GLA located at Davao City, Davao del Sur;
• Robinsons Palawan - 26,752.57 sqm of GLA located at Puerto Princesa City, Palawan;
• Robinsons Novaliches - 53,859.62 sqm of GLA located at Novaliches, Quezon City;
• Robinsons Cainta -19,390.17 sqm of GLA located at Cainta, Rizal; and
• Robinsons Ormoc - 22,774.56 sqm of GLA located at Ormoc City, Leyte.

The total transaction value of the properties at P33,915,960,000.00 is based on the independent property appraisal reports of Asian Appraisal Company, Inc. (AACI) while the third-party fairness opinion was issued by FTI Consulting Philippines, Inc. (FTI). It will be exchanged for 4,987,641,178 primary common shares at an exchange price of P6.80 per share which is set at a premium over RCR’s 30-day Volume Weighted Average Price (VWAP) of as of June 4, 2024. The appraised value and the exchange price are within the values indicated in the fairness opinion issued by FTI.

The Discounted Cashflows (DCF) Method was used by AACI as the primary method to estimate the fair value of the Properties. Under the DCF Method, the discount rate used is the weighted average cost of capital (WACC) using industry average and market risks as of valuation date. The Cost Approach was used by AACI as secondary method to cross-check the fair value of the Properties.

FTI, on the other hand, valued the Properties using the DCF Method and Direct Capitalization Method and valued RCR using the DCF Method with the VWAP Method and Comparable Public Companies Method as secondary methods to cross-check the values.

The transaction will qualify as a tax-free exchange under Section 40(C)(2) of the Tax Code.

The transaction will be subject to the approval of the Securities and Exchange (SEC) and the securing of the Certificate Authorizing Registration (CAR”) with the Bureau of Internal Revenue (BIR). The transaction will close upon the listing of the Shares with Philippine Stock Exchange (PSE).

Note that there is no increase in the Authorized Capital Stock of RCR and that the shares will come from unissued shares.