MANILA, Philippines — SM Prime Holdings Inc., the Sy family’s listed integrated property developer, is pouring in as much as P33 billion for its commercial property businesses this year to reflect the company’s sustained confidence on the economy.
The bulk of the investment or about P21 billion will be used by the company to expand the gross floor area of its malls, with the addition of 205,400 square meters of GFA from new developments.
A total of 124,488 square meters of existing mall space, meanwhile, will undergo redevelopment.
SM Prime, the largest mall operator in the Philippines with 87 malls in its portfolio, expects to end the year with a total GFA of 8.08 million square meters for its shopping centers.
The company plans to launch three new malls this year and eyes to have a portfolio of 100 malls in the country by the end of 2027 with its continuing expansion.
SM Prime expects election-related expenditures, a cyclical driver of economic expansion in the country, to stimulate aggregate demand and spending in various sectors, particularly retail.
The company said that its extensive network of shopping malls is strategically positioned to capture this surge, bolstered by strong consumer confidence and increased foot traffic.
Aside from its investment in malls, SM Prime will also spend around P6 billion in its hospitality and MICE (meetings, incentives, conferences and exhibitions) businesses to support the potential of the country’s tourism industry.
The amount will be used to build two convention facilities, renovate hotel rooms and add new food and beverage facilities in existing hotels.
Driven by robust demand and gains in lease take-up of existing inventory, SM Offices is also investing P6 billion to develop new office towers and work spaces.
Included in SM Offices’ development this year is the Six E-Com Center, a two-tower Grade A office complex within the Mall of Asia Complex.
Six E-Com Center is designed to cater to technology-driven industries and business process outsourcing firms.
Overall, SM Prime said that the P33 billion investment for its commercial property businesses this year is fueled by expectations of a sustained recovery in consumer demand and forecast of over six percent economic growth by the government.
“We expect moderating inflation, easing interest rates and election-related spending to fuel our growth in 2025,” SM Prime president Jeffrey Lim said.
“Our malls should do well and our office, hotel and convention centers could provide additional upside,” he said.
SM Prime said the investments further underscore its commitment to expanding and enhancing commercial properties that drive growth, attract businesses and meet evolving consumer demands.