Citicore’s Bold Move: Clean Energy REIT Listing Set for February 2022

Renewable energy-themed real estate investment trust (REIT) pioneer Citicore Energy REIT Corp. (CREIT) expects to list by February, aiming to raise P10.1 billion to scale up the group’s agro-solar farm operations in order to become the country’s largest by next year.

In a recent interview, CREIT president Oliver Tan said his group was preparing for predeal meetings and investor roadshows next month and targeting to price the initial public offering (IPO) by Jan. 26.

Assuming that all regulatory approvals and permit to sell have been obtained by then, CREIT’s public offering is targeted to run from Feb. 2 to 8 next year, while listing on the Philippine Stock Exchange (PSE) is targeted for Feb. 17.

The planned IPO is expected to be a milestone for the renewable energy sector, as CREIT will be the country’s first energy-focused REIT. Unlike traditional property-based, which primarily derive income from leasing commercial properties, CREIT will generate revenue by leasing out its renewable energy assets, such as solar farms, to power producers. This innovative model aligns with the global transition toward sustainable investments and could pave the way for similar green energy-backed in the future.

By going public, CREIT seeks to unlock additional funding that will be instrumental in expanding its solar energy portfolio. The proceeds from the IPO will be allocated toward acquiring and developing more agro-solar farms in strategic locations, including Bulacan and South Cotabato. These projects will not only help scale up renewable energy capacity in the country but also contribute to job creation in rural areas where the solar farms will be established.

The strong demand for renewable energy investments is also expected to boost investor interest in CREIT’s offering. With increasing pressure on businesses and governments to adopt sustainable energy solutions, renewable energy assets are becoming more attractive to institutional investors looking for long-term, stable returns. CREIT’s entry into the stock market offers an opportunity for investors to participate in the country’s clean energy transition while benefiting from the predictable cash flows generated by leasing solar assets.

Moreover, the IPO comes at a time when the Philippines is intensifying efforts to increase its renewable energy mix. The government has set ambitious targets for renewable energy adoption, aiming for renewables to account for 35% of the country’s power generation by 2030. CREIT’s expansion is expected to play a key role in achieving these targets, as it supports the financing and development of large-scale solar farms that can help reduce dependence on fossil fuels.

As CREIT moves forward with its listing plans, market observers will closely monitor how investors respond to this pioneering renewable energy. A successful offering could encourage more companies in the renewable energy sector to explore its structures as a means of raising capital while promoting sustainability in the real estate and energy industries.

Option to upsize

The Securities and Exchange Commission has already cleared CREIT’s registration of up to 1.047 billion primary common shares plus up to 1.742 billion secondary shares to be offered to the public at a maximum price of P3.15 per share. In case of strong demand, there will be an option to upsize the offering by up to 418.34 million shares.

CREIT has set aside a stabilization fund equivalent to 15 percent of the offering, Tan said.

Proceeds from the primary offering would be used to acquire properties in Bulacan and South Cotabato while the REIT sponsors—Citicore Renewable Energy Corp. and Citicore Solar Tarlac 1 Inc., led by the same group that controls construction and infrastructure firm Megawide Construction Corp.—could recycle as much as P6.8 billion in proceeds from the secondary offer for new projects.

The additional funds from the offering will allow CREIT to accelerate its expansion strategy, ensuring that it can rapidly scale its operations to meet growing energy demands. By acquiring more land assets for agro-solar farms, the company aims to enhance its renewable energy footprint while simultaneously optimizing the value of its real estate holdings. This strategic land banking will support long-term revenue generation and increase shareholder value.

Furthermore, the upsize option provides flexibility in responding to investor demand, reinforcing CREIT’s ability to capitalize on favorable market conditions. If the offering is met with strong interest, the additional shares could enhance liquidity and strengthen the company’s financial position for future acquisitions. This approach aligns with the broader goal of making CREIT a dominant player in the renewable energy sector.

By securing additional capital, CREIT also aims to boost its research and development efforts in solar energy technologies. With solar energy playing a crucial role in the global shift toward sustainable power, investing in innovative solutions can improve efficiency, reduce costs, and enhance overall project profitability. These advancements could further strengthen it’s position in the renewable energy market.

As the company moves forward with its IPO plans, market analysts and investors will closely monitor the performance of its share sale. A successful offering could set a strong precedent for future clean energy-focused in the Philippines, potentially encouraging more companies to explore similar models for funding sustainable infrastructure projects.

Property-oriented

The offering would bring 49 percent of CREIT’s post-IPO shares to public hands, assuming full exercise of the overallotment option. Before this, all five of it that have listed on the PSE are all property-oriented.

Unicapital Inc. and BDO Capital & Investment Corp. are CREIT’s joint global coordinators for the offer. Unicapital will likewise serve as lead underwriter and issue manager, while BDO Capital will serve as lead local underwriter alongside PNB Capital and Investment Corp., while Investment & Capital Corp. of the Philippines will act as participating underwriter.

The company also engaged CIMB Investment Bank Bhd and CLSA Ltd. as international bookrunners.

To date, CREIT has eight operating solar plants with a total capacity of 163 megawatts.

“What’s exciting is we have a robust pipeline. We will be building 1,500 MW of new solar in the next five years,” Tan said.

Out of the total projected portfolio, CREIT will have an attributable capacity of 1,000 MW.

This ambitious expansion plan positions CREIT as a leader in sustainable energy-focused REITs, reinforcing the shift towards renewable energy investments in the country. As global and local investors increasingly seek environmentally responsible assets, CREIT’s solar-driven model aligns well with the growing demand for green investment opportunities. By integrating real estate assets with renewable energy generation, the company is pioneering a unique model that blends infrastructure development with sustainability goals.

Additionally, CREIT’s entry into the market could influence other property developers and energy firms to explore structures as a means of financing large-scale infrastructure projects. With regulatory backing and strong investor confidence, the renewable energy model may set a precedent for future listings, encouraging more companies to leverage real estate-backed assets to fund clean energy initiatives.

Beyond financial growth, CREIT’s expansion is expected to create significant economic and environmental benefits. The development of new solar farms will not only contribute to the country’s renewable energy targets but also generate employment opportunities in engineering, construction, and operations. This aligns with the Philippine government’s push for sustainable energy policies and economic recovery post-pandemic.

As CREIT moves toward its listing, market analysts and investors will be keenly observing how its stock performs. A successful IPO could strengthen the company’s ability to execute its long-term strategy while establishing a new benchmark for sustainability-driven real estate investments in the country.

Conclusion

CREIT’s upcoming listing marks a significant milestone not only for the company but also for the Philippine capital markets, as it introduces the country’s first energy-focused REIT. By leveraging its real estate assets to support the expansion of solar energy, CREIT is pioneering a sustainable investment model that aligns with global trends in renewable energy financing. The IPO’s success could encourage similar ventures, fostering innovation in the sector and attracting investors who prioritize both financial returns and environmental impact.

As the company moves forward with its ambitious growth plans, the proceeds from the offering will play a crucial role in accelerating CREIT’s expansion and strengthening its position as a dominant player in the renewable energy industry. The ability to scale up its agro-solar farms and invest in technological advancements will not only enhance the company’s profitability but also contribute to the country’s broader clean energy transition. With the government’s push for increased renewable energy adoption, CREIT is well-positioned to become a key driver of the shift toward sustainability.

Ultimately, CREIT’s market debut will serve as a litmus test for investor confidence in renewable energy-backed. A strong reception could pave the way for more companies to explore similar fundraising structures, reinforcing the role of these in financing large-scale infrastructure projects. As global and local investors seek greener investment opportunities, CREIT’s success could signal a promising future for sustainable real estate investment in the Philippines.

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