MANILA – DoubleDragon and its industrial leasing unit CentralHub Industrial Centers Inc has signed a P3.97-billion deal with Jollibee Foods Corp for asset expansion and to create the country’s first and largest industrial real estate investment trust (REITs), it said Thursday.
Under the binding agreement, Jollibee will acquire common shares of CentralHub and infuse its 16.4 hectares of industrial properties used as commissaries, DoubleDragon said in a disclosure to the stock exchange.
The deal will bring CentralHub's total industrial portfolio to 39.8 hectares, which would include Jollibee's largest operating commissary, DoubleDragon said.
“We are excited to work together with Jollibee in developing CentralHub into the largest landlord of industrial warehouses in the country. We see CentralHub to become a major recurring income contributor to DoubleDragon,” said DoubleDragon Chairman Edgar “Injap” Sia II.
Sia said the goal is for CentralHub to become the "first and largest" industrial REIT in the country. Jollibee's infusion will help "accelerate" its fruition, he said.
In a separate disclosure, JFC said it would invest P2 billion worth of its land properties and about P1.9 billion in cash.
JFC plans to reduce assets tied to real estate properties by converting some of them into securities in REIT and by selling others to third parties, JFC founder Tony Tan Caktiong said.
Investments REITS and proceeds from the eventual initial public offering will fund future expansions, JFC said.
"This is a more cost-effective way of financing versus owning or pure leasing of properties due to the cash dividends JFC will receive from the REIT which will include the benefits and incentives provided by law to the REIT," Tan Caktiong said.
"The CentralHub will have its own property and fund managers who are separate from JFC. This will allow JFC to focus on growing its core business in food service, restaurant operations and food processing," he added.
CentralHub has a portfolio of industrial warehouse complexes utilized as commissaries, cold storage facilities, and logistics distribution centers.
Sia II and Tan Caktiong are co-chairmen of Double Dragon Properties Corp.
FROM OUR ARCHIVES: