Connect with us

Hi, what are you looking for?


[B-SIDE Podcast] REITs 101: Understanding real estate investment trusts

Follow us on Spotify BusinessWorld B-Side

Real estate investment trusts (REITs) have been called democratizers of wealth, allowing small investors to invest in big real estate projects.

The Philippines has two REIT listings on the market, with the second listing holding the record for the most number of retail investors. Officials from the exchange have expressed hope that more real estate developers will consider offering REITs. 

In this B-Side episode, Christopher John J. Mangun, research head of AAA Southeast Equities, Inc., introduces BusinessWorld reporter Keren Concepcion G. Valmonte to REITs and their advantages.


REIT is a unique financial vehicle that has features of different types of investments.

A REIT can be traded in the stock market, which means investors may earn through price appreciation when share prices go up. However, because it is traded on the public market, REITs are “subject to volatility and price fluctuations.”

Similar to time deposits or investing in government bonds, REIT investments also guarantee cash dividends. 

“It gives a guaranteed cash dividend, this is similar to what you would receive in a time deposit or in government bonds or treasury bills. So these are investments that have a fixed dividend yield and although it isn’t fixed for the REITs, they are required to submit or distribute the earnings of the company on a yearly or a quarterly basis so you get the best of both worlds,” Mr. Mangun explained. 

These dividends will come from the earnings posted by REITs, 90% of which will be distributed to its shareholders. 

“The main difference between REITs and regularly listed property companies is that REIT companies are required to distribute those earnings as a dividend,” Mr. Mangun said.

It is one of the best investments, especially for retail investors.

Retail investors will be given the opportunity to invest in dividend income-earning properties. Mr. Mangun noted that real estate is considered one of the safest assets in the world, but an investor would need capital to develop properties before earning returns. 

“But from the REIT, you can just buy the REIT and make money off of the dividends already from these big companies,” Mr. Mangun said.

REIT offerings help companies maximize the value of their properties. 

Mr. Mangun pointed out that current REIT offerings include properties that are already assets of listed companies.

Through a REIT listing, these companies were also able to raise more capital. 

“They were able to raise more funds which would allow the parent companies to develop more real estate or more landbank so I think this is a win-win for investors and for companies,” Mr. Mangun said. 

Investing in a REIT can tell you a lot about how markets work. 

REITs are “an easy way to learn about how markets work,” while also allowing investors to earn money.

Before investing in a REIT, investors should take a look at the company’s prospectus to check what the company is doing with the proceeds, if it will acquire new properties through debt or through higher leases. Investors should also see how much these companies earn on a yearly basis.

“It is important that we know how much these companies are making because that translates into the dividend yield, this tells you how much you will be earning on a yearly basis,” Mr. Mangun said. 

This B-Side was recorded remotely on March 25, a day after the REIT of DoubleDragon Properties Corp., DDMP REIT Inc., debuted at the Philippine Stock Exchange, making it only the second listing after Ayala Land’s REIT offering in 2020. Produced by Paolo L. Lopez and Sam L. Marcelo.

Follow us on Spotify BusinessWorld B-Side

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!



By Diego Gabriel C. Robles THE COUNTRY’S Socioeconomic Planning chief on Monday belittled the peso’s free fall against the dollar, saying there is nothing...


By Kyle Aristophere T. Atienza, Reporter SAN MIGUEL CORP. would proceed with building an international airport north of the Philippine capital even after a...


FELIPE M. MEDALLA / COURTESY OF BANGKO SENTRAL NG PILIPINAS PHILIPPINE CENTRAL BANK Governor Felipe M. Medalla would continue the “game-changing” reforms of the...


RAZON-LED Prime Infrastructure Capital, Inc. through its unit WawaJVCo, Inc. announced that it completed the Tayabasan weir, which is the first phase of its...


FRUITAS Holdings, Inc. plans to use part of its one-time gain from selling existing shares in subsidiary Balai ni Fruitas, Inc. to fund its...


LISTED construction company Megawide Construction Corp. announced on Monday that it secured its eighth contract with housing developer PHirst Park Homes, Inc. (PPHI). Under...

You May Also Like


Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...


Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...


Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...


As a traditionally rigid insurance industry becomes bogged down by antiquated processes and operations, a handful of industry leaders are seeking to shake things...

Disclaimer:, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.