MANILA, Philippines (UPDATE) – Property giant SM Prime Holdings Inc. is planning to open more than 30 malls in the next five years, its executives announced Tuesday.
SM Prime chief financial officer Jeffrey Lim said from its current 48 malls across the Philippines, it is targeting to hit 74 by 2018.
Lim said the new malls will not be focused in one region and will be distributed nationwide.
“We have properties in Davao, Cebu, Bacolod, Cagayan de Oro, all the way to Cabanatuan. We also have one in Mindanao—in General Santos City, but we continue to look for more properties there,” Lim said after SM Prime’s annual stockholders' meeting at the SMX Convention Center in Pasay City.
SM is also planning to more than double its footprint in China to 11 malls in the next five years, from the current 5 in operation.
This would bring the number of SM malls in the Philippines and China to 85 by 2018.
SM Prime chairman Henry Sy Jr., meanwhile, said the firm is considering expansion in other Southeast Asian countries.
"We are looking at countries where the culture is not much different from ours," he said.
Lim said at least 10 of the malls that will open in the next five years will be built in “lifestyle cities,” similar to the 60-hectare Mall of Asia complex.
“When you talk of lifestyle cities, it can be a mall, residential, with hotels or convention center, with mall as its anchor,” he said.
The mixed-use “lifestyle city” concept will be developed in SM properties in Cebu and China.
Development of lifestyle cities are also planned in SM North EDSA, Pampanga, and Davao.
For its residential projects, SM is looking to increase the number of units to 139,628 in 41 projects by 2018 from the current 63,892 units in 21 projects.
More office space, hotel rooms and leisure projects are also expected to be launched under the consolidated SM Prime.
SM Prime president Hans Sy described the consolidation as the unit’s “fundamental shift” from being primarily a mall developer to an integrated property company.
Lim said the integration puts SM Prime in a “great position to pursue its next stage of growth. SM Prime has now access to significant higher land bank of over 900 hectares as of December 2013.”
SM Prime is allocating an estimated P400 billion in capital expenditures for its five-year plan, with net income and revenue expected to double in this period.
The funds will be raised through internally-generated cash and debt, Lim said.
This year, SM Prime will spend P70.57 billion in capital expenditures, more than half of which will be used to fund mall projects (55 percent).
Twenty-eight percent of the capex will be allocated for residential, 10 percent for commercial, and the remaining 7 percent for hotels and convention centers.
New SM City malls in Cauayan and Angona, and SM Zibo in China are expected to open this year to add a total gross floor area of 0.28 million square meters.
Expansions of SM Megamall, SM City Bacolod and SM City Lipa, and other mall openings will also bring the total gross floor area of SM malls to 7.5 million square meters by the end of the year.
The construction of Park Inn Clark is scheduled to start in the second half the year while three new residential projects will also be launched within the year.
An SMX center in Bacolod is also slated to be launched in the fourth quarter of this year.