By Arra B. Francia, Reporter
SM PRIME Holdings, Inc. (SM Prime) is accelerating its spending program in the next two years to support the continued expansion of its shopping mall and residential projects into the provinces.
In a presentation to investors posted on its Web site, SM Prime said it plans to spend an average of P80 billion over the next two years. This is 60% higher than the P50-55 billion capital expenditure program it disclosed in 2017.
SM Prime’s residential component, SM Development Corp. (SMDC), will get the largest share from the capex program at 46%. The shopping mall business follows with 42%, while commercial businesses will get 9%. The remaining 2% will be spent for hotels and convention centers.
SM Prime said it will fund the spending program through a combination of local borrowings and internal funds.
This year will see the opening of six new SM malls in the country, namely SM Center Imus, SM City Urdaneta, SM City Telabastagan, SM City Legazpi, SM Center Ormoc, and SM Dagupan-Arellano.
This will bring SM Prime’s mall count in the Philippines to 73 after ending 2017 with 67 malls covering 8.03 million square meters of gross floor area.
The company added that it has a land bank of 154.33 hectares for mall developments, which will be good for the next five years.
For shopping malls in China, the company said future expansions will focus in the Fujian province. SM Prime operates seven malls in China with a footprint of 1.3 million square meters.
Meanwhile, SMDC said it is currently constructing 13,876 units which have yet to be sold. The company also has 2,697 unsold units that are ready for occupancy.
The residential business has room to expand as SM Prime reported a land bank of 556.22 hectares for the primary homes segment alone, and another 539.10 hectares for leisure homes.
For the office business, SM Prime is set to launch by the first half of 2018 the ThreeE-ComCenter in the Mall of Asia Complex in Pasay City. The new office building has a GFA of 130,000 sq.m., which the company said is already fully leased out.
Also under construction is the FourE-ComCenter with a GFA of 191,000 sq.m., set to be completed by 2020.
SM Prime is keeping its hotel and convention centers business steady, as it now operates six hotels with more than 1,500 rooms, four SMX convention centers, and three Megatrade Halls with over 37,000 sq.m. of leasable space.
SM Prime booked a net income of P27.6 billion in 2017, 15.8% higher year on year as revenues also climbed 13.9% to P90.9 billion.
Shares in SM Prime gained 45 centavos or 1.27% to close at P35.75 each at the stock exchange on Thursday.