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Sy-led SM Prime Holdings, Inc. (SM Prime), one of Southeast Asia’s largest integrated property developers, is allotting up to ₱33 billion for capital expenditures this year as it continues to expand its recurring income portfolio.
In a disclosure to the Philippine Stock Exchange, the firm said the additional investment in its commercial property businesses is driven by expectations of a sustained recovery in consumer demand and forecast of over six percent growth by the Philippine government.
"We expect moderating inflation, easing interest rates and election-related spending to fuel our growth in 2025. Our malls should do well and our office, hotel and convention centers could provide additional upside," said SM Prime President Jeffrey C. Lim, highlighting the company's strong outlook.
He noted that election-related expenditures, 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 extensive network of 87 shopping malls is strategically positioned to capture this surge, bolstered by strong consumer confidence and increased foot traffic.
The firm has earmarked approximately ₱21 billion for the expansion of its malls' gross floor area (GFA) to 8.08 million square meters by the end of the year. New developments will add 205,400 square meters of GFA, while 124,488 square meters of existing mall space will undergo redevelopment.
Recognizing the potential of Philippine tourism, SM Prime said it will invest around ₱6 billion in its hospitality and MICE businesses to build two convention facilities, renovate hotel rooms and add new food and beverage facilities in existing hotels.
Meanwhile, driven by robust demand and gains in lease take-up of existing inventory, SM Offices is investing ₱6 billion to develop new office towers and work spaces.
This includes 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 (BPO) firms.
“SM Prime’s investments underscore its commitment to expanding and enhancing commercial properties that drive growth, attract businesses and meet evolving consumer demands, solidifying its leadership in the property sector,” the company said.
