Posted on 09:31 PM, July 12, 2010 [ BusinessWorld Online ]
THE RACE to be the first company to list on the local bourse as a real estate investment trust (REIT) involves the advantage of securing an investor base, government and industry officials said yesterday.
As a novel investment vehicle in the local capital market offering higher dividends, REIT companies can expect to be swamped.
“The first ones in general have an advantage in listing only because [the REIT] is a new animal,” Eduardo V. Francisco, president of Banco de Oro (BDO) Capital and Investment Corp., said in a briefing.
“There is big excitement because it is new,” said Justina F. Callangan, director of the Corporate Finance Department of the Securities and Exchange Commission.
Late last month, the PSE approved listing rules for REIT companies, which are required to have 1,000 shareholders holding 50 shares each and a minimum P300 million in capital.
Mr. Francisco noted that the weighted average yield of REIT companies in other countries is higher than those of other investment vehicles. For instance, Australia’s 57 REIT companies with $70.747 billion in assets have a yield of 9.7%. The yield is 6.1% for Hong Kong’s seven REIT firms with $9.518 billion in assets, and 5.6% for the United States’ 142 companies with $521-billion assets.
Ms. Callangan said REIT firms must go public two years after getting REIT’s perks, or else face penalties and surcharges.
Perks include a lower withholding tax and income tax as well as a 50% discount on the documentary stamp tax. There will also be no initial public offering or IPO tax.
Meanwhile, Mr. Francisco said BDO Capital was working on the IPO plans of four companies, on top of the five being screened by the PSE.
But the listing of Harbour Centre Port Holdings, Inc., which wants to secure P3 billion from an IPO, has been sent to the backburner amid a dispute with port users. -- Neil Jerome C. Morales
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