Philippine-listed fast-food giant Jollibee Foods Corporation (JFC) has approved a 3.9 billion pesos ($77 million) investment to create the country’s first and largest industrial real estate investment trust (REIT) in partnership with realty major DoubleDragon.
In a disclosure to the Philippine Stock Exchange Friday, Jollibee said that it, together with its wholly-owned subsidiary Zenith Foods Corporation, has executed the definitive agreement implementing the company’s investment into CentralHub Industrial Centres.
CentralHub is DoubleDragon’s industrial leasing unit. It is in the business of developing industrial warehouse complexes that will contain standardized, multi-use, and industrial quality warehouses suited for commissaries, cold storage, and logistics centers to be leased to locators operating nationwide.
The deal, which was first announced in July, will see Jollibee investing land properties worth around 2 billion pesos and 1.9 billion pesos in cash in Central Hub. Under the agreement, Jollibee will subscribe to 1.6 million common shares of CentralHub in cash. It will also infuse 16.4 hectares of its industrial properties in CentralHub’s portfolio in exchange for additional common shares.
The CentralHub Industrial Centers intends to eventually register and operate as a REIT, with a planned initial public offering (IPO) in 2022.
The timing for the registration of the REIT’s IPO and the filing of the application for the REIT listing of CentralHub will be subject to the agreement of Jollibee and DoubleDragon.
JFC chairman and founder Tony Tan Caktiong earlier said the eventual IPO will help fund real estate investments for new stores and commissaries, which will again convert into more REIT investments and shares.
“JFC’s plan is to reduce assets tied to real estate properties by converting some of them into securities in REIT and by selling others directly to third parties,” Caktiong earlier said.
In a separate disclosure, DoubleDragon confirmed that it has executives the definitive agreements implementing the investment of JFC into CentralHub.
“The cash and property infusion investment of Jollibee to acquire common shares in CentralHub will grow both the recurring rental revenue portfolio of DoubleDragon’s CentralHub with the consolidation of the existing operating commissaries and warehouse assets of Jollibee,” DoubleDragon said.