Cebu Landmasters to join REIT market once hospitality segment gains traction

Visayas and Mindanao property developer Cebu Landmasters Inc. (CLI) on Monday revealed plans to enter the real estate investment trust (REIT) market in the mid to long term, once its hospitality business has gained steam.

According to chief finance officer Beauregard Grant Cheng, the company will first focus on rolling out its hospitality projects which are expected to start operations by 2023.

“Not immediately, but certainly a strategy we’re looking at in the mid- to long-term,” he said in a virtual briefing.

“Once we have that track record, we definitely plan to do our REIT, and our REIT is going to be the only one that provides pure diversification away from, let’s say, NCR and Luzon,” he added.

CLI is optimistic that the company’s hospitality segment will be buoyed by the pent-up demand for travel and leisure amid the lockdowns implemented to curb the spread of COVID-19.

“I think our timing is actually quite fortuitous because more of our projects — especially that of hospitality projects — will start operating between 2023, mostly towards 2024, 2025,” he said.

CLI opened its first development in September 2019, the Citadines Cebu City, a 180-room condotel operated and managed by Ascott International Management Pte. Ltd.

The company’s product portfolio also covers residential, office, and estates covering the high-end, middle, economic, and socialized housing segments, with the hospitality and mixed-use assets to be included in the REIT.

“Definitely those are assets we plan to put in our future REIT listing because those are recurring income assets that we’re building,” Cheng said.

“Our investors and the market can look forward to a REIT where part of your assets is owning hospitality or part of the hospitality structures and assets in Visayas and Mindanao,” he added.

In the same briefing, CLI said it is on track to meet its earnings guidance of 15% to 20% growth, after recording historic growth in the first half of the year.

Net income for the six-month period climbed 66% year-on-year to P1.32 billion from P792 million, as revenue jumped to P5.1 billion from P3.5 billion.

“Housing has proven to be resilient and sustainable since it is now, more than ever, considered a basic need especially with the extended pandemic,” chief executive officer Jose Soberano III said.—AOL, GMA News