Sponsor risk

Sponsor risk — a PH REIT’s two-sided dependence on its sponsor, the developer (Ayala Land, Megaworld, Robinsons Land…) that carved buildings into the REIT and usually controls its fund and property managers. Upside: a deep-pocketed sponsor with a long pipeline grows the REIT through asset injections (AREIT’s ₱100B+ from Ayala Land since 2020). Downside: a stretched sponsor can use its captive REIT as a dumping ground for assets at flattering prices, approved by a board it effectively controls. Check who the managers answer to, then read injection pricing with that in mind.

First used in: 2.2 · REITs: landlord without tenants