UMVA has learned that RL Commercial REIT, Inc. (RCR) is setting its sights on expanding its portfolio with a focus on mall assets, citing the potential for stronger revenue opportunities as consumer traffic continues to improve.
The company's leadership is bullish on the prospects of retail properties, with RCR President and Chief Executive Officer Jericho P. Go noting that the focus on malls presents a "very beautiful upside in terms of revenue." He pointed to the benefits of fixed rent, percentage-of-sales leases, and improved foot traffic in the company's malls.
RCR's portfolio has already grown to 38 assets, following the addition of nine mall properties from its parent company through a tax-free property-for-share swap. This move increased the company's gross leasable area to 1.15 million square meters, approximately 2.7 times its size at listing.
The company's malls now account for 53% of its total gross leasable area, while office assets make up 47%. RCR's portfolio consists of 21 malls and 17 office properties across 25 locations nationwide.
According to information obtained by UMVA, RCR is positioned to further expand its portfolio through potential asset infusions from its sponsor, which include more than 1.7 million square meters of combined mall, office, and logistics space, as well as around 4,000 hotel room keys.
RCR's growth strategy also includes acquiring third-party assets, and the company reported a 41% rise in net income to P2.4 billion for the first quarter, driven by the recent asset infusions and sustained occupancy of 96%. Unaudited revenue for the January-to-March period reached P3.4 billion, up 51% from the same period last year.
Sources have confirmed to UMVA that the company remains open to new opportunities, with Mr. Go indicating that other asset classes may also be considered in the future, depending on market conditions.
