The SM group of tycoon Henry Sy, through residential development arm SM Development Corp., is setting aside as much as P15 billion for capital spending next year to sustain the rollout of new residential units.
SM Prime Holdings chief finance officer Jeffrey Lim, who is also acting chief executive officer of SMDC, said the group won’t hold back on its launch of new projects in the coming year.
SMDC plans to bring to the property market four new projects next year for an additional inventory of around 11,000 units, Lim said in an interview Wednesday night.
“We will continue to roll out new projects,” Lim said, adding that demand remained strong enough for SMDC to sustain the pace of rollout in previous years.
For instance, he noted that SMDC was able to sell P2.3 billion worth of condominium units at Shore Residences in the Mall of Asia complex less than two months from the time the project was unveiled.
In 2013, SMDC rolled out only two new projects equivalent to around 10,000 units, Lim said.
Also this year, the SM group embarked on a consolidation program for key property units that folded SMDC, Highlands Prime and the privately held SM Land into a single publicly listed entity, SM Prime.
With this consolidation, SM Prime thus became a full-range property developer and also became Southeast Asia’s biggest property developer in terms of market capitalization.
Recently, the SM group became the biggest office property landlord in Bonifacio Global City with a deal to acquire an 85-90 percent economic interest in five Net Group buildings with a combined gross leasable space of 147,000 square meters.
Jones Lang LaSalle property consultants estimate the deal at around P18 billion.
SM Investments chief finance officer Jose Sio said P18 billion was the estimated value of assets acquired, but noted that liabilities would still be taken out of the final computation.
The deal gives SM controlling interest in Net One, Net Square, Net Cube, Net Quad and Net Plaza buildings.
The SM group is buying out controlling interest in 10 companies from Net Group’s partner in the project but Net Group itself will retain its interest.
The seller, CPI Asia Ten BV, is a private equity fund managed by a New York-based asset manager.