SM Prime to spend PHP75 billion on land banking
Integrated property company SM Prime Holdings expects capital expenditure to reach about PHP75 billion (US$1.4 billion) this year – 15 per cent more than the PHP65 billion spent last year.
SM Prime president Jeffrey Lim says it is more about buying new properties, for both malls and mixed use, as land banking.
Meanwhile, SM Prime is looking at opening seven malls this year, most of which will be outside of Metro Manila.
Lim says the capex this year will be partly funded by the PHP20 billion the firm has raised from issuing retail bonds. Overseas, the company’s expansion focuses on building a mall in China, though “we are looking at other countries, but it is still exploratory”.
He says Vietnam is a target country, at an exploratory stage for both mall and residential projects. He believes the market is “okay” with a JV being the better option for SM Prime.
SM Prime had 16 per cent growth in recurring net to PHP27.6 billion last year.
Consolidated revenues grew 14 per cent to PHP90.9 billion while overall operating income improved by 15 per cent to PHP40.6 billion. The company says the growth was driven by increase in rental revenue from malls opened and expanded in 2016 and last year.