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Risk Management

FILRT's risk governance is led by a Board Audit and Risk Oversight Committee which considers strategic, operational, financial and compliance risks, sets the tone for risk treatment and assesses risk monitoring and assessment reports. The President and CEO serves as the risk executive for FILRT.

The table lists down the significant risk items with the corresponding risk mitigation actions.

Philippine macroeconomics and demand for commercial spaceContinued development of Filinvest City and interconnections with government's planned transport infrastructure
COVID-19 pandemic and resulting economic downturns and mobility restrictions

Support to and compliance with government's directives on COVID-19, on both health and deferred payments

Focus on its leasing strategy to multinational global firms, including BPO, IT and traditional companies

Various measures for the safety of tenants, customers, suppliers, service providers and employees

Government's real estate-related policiesEngagement with national agencies during the public consultations on policies or regulations under development
Related party transactions

Corporate governance provisions and related party transactions policy

Application of arms-length principle in all dealings

Compliance with BIR transfer pricing guidelines

Lease-related risks: global leasing trends, vacancies, reduced occupancy, untimely expiration or early termination of leases, delays and inability to collect rent payment, volatility in market rental rates

Leasing policies on screening tenant applicants

Securing appropriate mix of tenants;

Security deposits and advance rent

Reconfiguration of tenant spaces where required

Flexibility to tenant needs

Loss of PEZA accreditation, tax exemptions and incentives

Compliance with conditions in accreditations and permits

Timely renewal of permits and filing of mandatory reports

Competition in real estate market

Continuous investments in quality properties

Continuous repair and maintenance of properties

Illiquidity of real estate investments

Active management of capital structure

Well-balanced risk management strategy

Increase in operating expenses

Optimization of operating costs

Operational efficiencies, including energy management and digital solutions

Litigation risks and regulatory disputes

Relationship management with regulators

Adoption of clear dispute resolution mechanisms