SM Prime Holdings Inc. said it is spending P33 billion this year to beef up its commercial space business, betting on an unimpeded rebound in private spending.
“We expect moderating inflation, easing interest rates and election-related spending to fuel our growth in 2025,” Jeffrey Lim, SM Prime president, said in a statement on Thursday.
“Our malls should do well and our office, hotel and convention centers could provide additional upside,” Lim added.
The property developer said it believes the economy will grow within the government’s target of 6-7 percent this year.
“Election-related expenditure, a cyclical driver of economic expansion in the Philippines, are anticipated to stimulate aggregate demand and spending in various sectors, particularly retail,” SM Prime’s president said.
The company said its extensive network of 87 shopping malls is “strategically positioned” to capture the surge in spending, bolstered by a strong consumer confidence and increased foot traffic.
Lim said SM Prime aims to spend P21 billion on the expansion of its malls in terms of gross floor area (GFA).
“New developments will add 205,400 square meters of GFA, while 124,488 square meters (sqm) of existing mall space will undergo redevelopment,” he said.
SM Prime targets to close the year with a GFA of 8.08 million sqm for its malls portfolio.
Steven Tan, president of SM Supermalls, said in December last year the company plans to open three malls in the and redevelop at least 10 malls this year.
Supermalls is a corporate entity wholly-owned by SM Prime
Of the new SM malls that will open this year, one is located in Laoag, La Union and the other in Zamboanga City.
Up for redevelopment are certain parts of the Mall of Asia — already nearing its completion. SM Aura is also undergoing renovation, as well as SM Clark.
At the same time, SM Prime will invest around P6 billion on its hospitality and meetings, incentives, conferences and exhibitions businesses 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 investing P6 billion to develop new office towers and workspaces,” Lim said.
In an investors note last January, RCBC Securities said it expects SM Prime to post a 10 percent growth for the year on the basis of its planned expenditures.
