The Department of Finance (DOF) expects the real estate investment trust (REIT) will help drive the infrastructure modernization and open more business opportunities in the country.
During the DoubleDragon Properties Corp.’s (DDPC) DDMP REIT Inc. listing ceremony on Wednesday, March 24, Finance Secretary Carlos G. Dominguez III said REIT is a powerful financial mechanism to broaden access to investments.
Dominguez also said REIT is an indispensable tool in rebuilding the economy from the coronavirus-induced recession.
“At this particular time in our history, REITs are indispensable to rebuilding a strong and truly inclusive economy for our people. These will make available huge volumes of capital to our financial system that will help fund our long term growth,” Dominguez said.
He noted that when the REIT Law was passed in 2009, no company found its terms attractive, owing to what property players cited as friction costs, minimum public ownership requirements, and taxes as obstacles for the REIT to flourish in the country.
It was the Duterte administration that “took on the challenge of crafting a regulatory framework for this financial instrument that is right for the country,” Dominguez said.
He said the Duterte administration also ensured that all shareholder proceeds from REIT offerings will be retained within the domestic economy and used to drive the country’s growth.
Since its enacted in 2009, two major property developers were able to successfully list their REIT offerings in the stock market.
Ayala Land’s REIT raised P13.6 billion, while DoubleDragon’s offering is expected to net as much as P14.7 billion.
Dominguez congratulated DDPC, and its chairman, Edgar Injap Sia II, “for bringing another milestone to the Philippine stock market” with its successful public listing of its REIT.
“I commend DoubleDragon’s remarkable business acumen and resilience amid these challenging times,” Dominguez said.
“As with the previous initial public offerings (IPOs) made during the pandemic, DoubleDragon’s REIT listing reflects the strong confidence of our investors in our economic recovery,” he added.
DoubleDragon has successfully thrived in adverse conditions and even amid the uncertainties triggered by the COVID-19 pandemic, Dominguez noted.
He recalled that while the economy remained largely on lockdown last year, DoubleDragon was able to successfully launch the IPO of its MerryMart Consumer Corp., a retail company principally engaged in the operation of grocery stores.
DoubleDragon has again done so with its REIT, which is the largest issuance so far and the second to be listed in the country’s history, following Ayala Land’s pioneering REIT last year.
“Today, we deliver again to our economy a powerful financial mechanism to further broaden access to investments and promote greater financial inclusion for the Filipino people,” Dominguez said.