Property developer SM Prime Holdings Inc. said Tuesday it budgeted P80 billion for 2020 capital expenditures, up 16 percent from P69 billion it invested in 2019, to fund the expansion of mall and residential businesses and support land banking activities.
SM Prime said in an investor presentation that 39 percent of the P80-billion programmed spending for 2020 would go to the residential business while 37 percent would be for mall expansion.
The remaining 24 percent will be allotted for land acquisition for future projects and for the expansion of other businesses such as hotel, office and convention centers.
It said the P80-billion budget would be funded by a combination of local borrowings and internal funds.
SM Prime is set to open five new malls in the Philippines this year, including those located in Butuan, Zamboanga, Daet, Caloocan and Roxas City.
It expects to have 79 malls in the Philippines and seven malls in China with an estimated combined gross floor area of 10.2 million square meters by end-2020.
SM Prime is scheduled to launch 15,000 to 20,000 residential units this year across high-rise buildings, mid-rise buildings and house-and-lot projects. These projects are mostly in Metro Manila and other key cities.
SM Prime’s commercial properties group is set to launch Four E-Com Center”•an office development at MOA Complex in Pasay City this year while its hotel and convention center business unit would open a new hotel in Bacolod.
SM Prime is offering P20 billion in fixed-rate bonds to partially finance the company’s capital spending program.
“SM Prime is set to establish further integrated property developments in various developing provincial cities in the Philippines. The proceeds from the retail bond will enable the company to pursue its expansions plans for its core businesses, primarily its malls projects, which is one of the main growth drivers of the company,” SM Prime president Jeffrey Lim said.
The joint issue managers for the offering are BDO Capital & Investment Corp. and China Bank Capital Corp., which are also acting as joint lead underwriters and joint bookrunners, as well as BPI Capital Corp., EastWest Banking Corp., First Metro Investment Corp., RCBC Capital Corp. and SB Capital Investment Corp.