SM Prime allots P6B for 2 malls in Cebu

Written by Miguel R. Camus / Reporter

Sunday, 18 July 2010 19:39

SM Prime Holdings Inc., the country’s largest mall developer and operator, is investing P6 billion in Cebu over the next three years to launch two more malls in the fast-growing Visayan province. In a chance interview last week, SM Prime president Hans Sy said the listed company is investing P5 billion to build a mall on a 28-hectare lot within the reclaimed 240-hectare South Road Properties (SRP) in Cebu City. Sy said another P1 billion will be spent to develop an SM shopping center in a five-hectare property in Consolacion, a first-class municipality approximately 12 kilometers north of Cebu City. Construction works in the two will start this year. The Consolacion mall, the smaller of the two, is expected to be completed by 2011. Sy said earlier that this mall will offer 50,000 square meters (sqm) of gross floor area. The SRP mall, which will be the developer’s third shopping center in the island, will feature 250,000 sqm of gross floor area. SM Prime made its debut in the island province when its opened SM City Cebu in 1993. Meanwhile, the P5-billion budget for the SRP mall represents a fourth of the P20 billion the SM Group plans to invest in the area, which is being positioned as a smaller version of its Mall of Asia Complex in Pasay City. Apart from the shopping center, plans for the SRP complex include a 60,000-sqm convention center as well as hotels and condominium buildings to be constructed under SM Development Corp., the listed middle-income condominium developer of the SM Group. SMDC president Rogelio Cabuñag said earlier his company has been “invited” to build projects near the SRP mall. The hotel arm of the SM Group is also bullish on Cebu, with its plan to open within this year the 400-room Radisson Blu Hotel Cebu at the city’s North Reclamation Area near SM City Cebu. SM Prime plans to be the first company in the Philippines to hold a Real Estate Investment Trust offer. The company is eyeing to raise up to $600 million by spinning off its “mature” mall assets into a separate entity to be listed and traded on the local stock exchange. SM Prime earlier reported a 10-percent increase in its first-quarter net income to P1.9 billion while revenues grew 15 percent to P5.4 billion. This year SM Prime plans to spend P12 billion to launch four new malls in the country and one in China. The company expects to have a total of 44 malls by the end of the year, of which 40 will be in the country and four in China.