Property giant SM Prime Holdings Inc. is set to open four new Philippine shopping malls with a combined gross floor area of 292,000 square meters (sq m) this year, cementing its market leadership in the retail property space.
SM Prime—now the most valuable company in the local stock market and a leading property developer in Southeast Asia in terms of market capitalization —ended last year with 60 shopping malls in the country. With six malls in mainland China, its shopping mall portfolio has a gross floor area (GFA) of 8.6 million square meters.
In a chance interview on Thursday, SM Prime president Jeffrey Lim said that this year, the company’s focus would be on the shopping mall and residential space.
“We will open four new malls,” Alexander Pomento, vice president for investor relations at SM Prime, said in an e-mail on Saturday, when asked about new retail space to be made available this year.
The new malls to be opened this year are SM Tuguegarao (Cagayan Valley), SM Puerto Princesa (Palawan), Cherry SM Antipolo (Rizal) and SM Premier Cagayan de Oro.
Pomento said the new malls would have the following GFA: Tuguegarao (40,000 sq m); Puerto Princesa (70,000 sq m); Antipolo (30,000 sq m) and Cagayan de Oro (152,000 sq m).
In recent years, SM Prime has been opening at least four new malls in the Philippines yearly but Pomento added it was always a “timing issue,” referring to paperwork to be cleared at the local government level.
So far, he said about 370,000 people were employed in SM Prime’s 60 shopping malls as of the end of 2016.
SM Prime’s newest shopping mall in the Philippines is the 80,000-sq m SM City East Ortigas, which targets customers in the eastern part of Metro Manila.
In the first nine months of 2016, SM Prime grew its consolidated net income by 13 percent year-on-year to P17.5 billion, buoyed by higher shopping mall, office, residential development and hotel revenues.
For the third quarter alone, SM Prime’s net profit rose by 15 percent year-on-year to P4.9 billion, supported by a 14-percent expansion in revenue to P18.5 billion.
Philippine shopping mall revenue grew by 9 percent year-on-year to P32.1 billion in the first nine months. Rental income expanded by 11 percent year-on-year to P26.9 billion from existing and new malls.
In the last two years, the group expanded its shopping mall GFA by one million square meters. Excluding earnings from the leasing of newly-built retail space, same-mall sales grew by 7 percent year-on-year.
In the meantime, mall revenue from China rose by 5 percent year-on-year to P3.1 billion in the first nine months while operating income grew by 6 percent year-on-year to P1.5 billion.