SM to complete Pasay City reclamation project in 5 years

The SM group expects to complete a 300-hectare Pasay City reclamation project worth P54.5 billion within five years and bring in other groups to participate in the development, including prospective foreign investors.

“It’s not something that only we will develop. We will take in other developers. We’ve been in talks with some foreign groups coming in,” SM Prime Holdings president Hans Sy told reporters on Thursday in an interview at the sidelines of an Urban Land Institute event.

The Pasay City Council recently voted to proceed with the controversial reclamation project through a joint-venture agreement between SM Land Inc., a property unit under SM Prime, and the local government under Mayor Antonino Calixto.

Sy said the SM group would finish the master plan for the project within the first quarter with the help of a foreign consultant, which is working in collaboration with local experts.

The P54.5-billion investment, he said, would cover only the reclamation and would not be a one-shot deal. He said further investments would be made to implement the master plan.

“The whole process of reclamation is about five years and to do drainage system, to make it land for development,” Sy said.

Sy said the SM group was confident on making this project work, drawing experience from its Mall of Asia complex, which he noted fared very well during the monsoon season and was not affected by a storm surge in Roxas Boulevard. As an internal policy, Sy said the SM group was doing “beyond what’s required” by building guidelines.

Of the 300-hectare project, around half of the area to be reclaimed, including roads and open spaces, will go to SM and the rest to the local government.

Given the constitutional restriction on foreign ownership of land to 40 percent, the SM group intends to bring in foreign investors to the project in line with such limitation. Sy said that “40 percent is still a big chunk (for foreign investors to become interested).”

“It’s very attractive. A lot of people don’t see the big opportunities,” he said.

Sy also said that SM would embark on an “environment-friendly” reclamation process. “When it comes to reclamation, some are thinking I will carve a mountain and fill up the water but what we will do and what we did in MOA is dredging—getting from the bottom of the seabed and putting all up so the balance of sea and land is still there,” he said.

The SM group is setting up a team to explain these things to the people, Sy said.

Meanwhile, Sy refuted rumors that SMPH would tap the capital markets soon after the consolidation of key SM property units under its wings.

“I’d like to get the complete picture first with consolidation and after the first quarter, we will know our capex (capital expenditure). There’s no plan to go to the capital market yet,” Sy said.