THE country’s largest mall developer, SM Prime Holdings Inc. (SMPH), is spending P5.5 billion this year to fund its continued expansion in China, its president Hans Sy said on Tuesday.

At the sidelines of the company’s annual stockholders’ meeting, he said they will further boost their presence in China with the construction of three additional malls in Suzhou, Chongqing and Zibo. At present, SMPH operates malls in Xiamen, Jinjiang and Chengdu, which have contributed revenues of P825 million in 2008 and net income of P100 million.

“The fourth mall in Suzhou, with a gross floor area of 73,000 square meters, is under construction and will open early 2010. Our next two other locations, in the cities of Chongqing and Zibo, are scheduled to open in 2011 and 2012, respectively,” said Sy.

On the domestic front, the company will also continue to be aggressive and has allotted P6.5 billion to fund the expansion.

“For 2009, we have lined up three new malls, namely, SM Naga with a GFA of 73,000 square meters; SM Pamplona in Las Piñas with 40,000 square meters and SM Rosario in Cavite with a GFA of 50,000 square meters. We are also opening the Sky Garden at SM North Edsa with an additional GFA of 34,000 square meters and SM Supercenter Rosales with an additional 17,000 square meters,” Sy added.

SMPH is also building toward the end of the year a complete shopping mall in Taguig City at a cost of about P2 billion.

“We will have something very similar to the Mall of Asia. Our target is to complete it by 2011,” said Sy.
            
In total, the company will have a capex of P12 billion this year to be funded by internally generated cash and external borrowings.

Early this month, the company successfully sold its P5 billion floating and fixed-rate notes facility with 11 primary institutional lenders subscribing to the issue.

The deal was arranged by BDO Capital & Investment Corp.  with PNB Capital & Investment Corp. acting as colead arranger.

Proceeds from the issuance will be used to fund ongoing capital expenditure, mainly the construction of new malls both here and in China.

SMPH, controlled by the family of tycoon Henry Sy Sr., ended 2008 with a consolidated net income of P6.4 billion from P6 billion the year before. Revenues, on the other hand, grew 12 percent to P17.8 billion.