SM Prime Holdings Inc., one of Southeast Asia’s largest integrated property development firms, is planning to issue up to P70 billion in bonds to help fund its P180-billion capital expenditure (capex) budget for the next three years.
 
In a briefing after the firm’s annual stockholders’ meeting yesterday, SMPH executive vice president Jeffrey Lim said they will soon seek the shelf registration of P50 billion to P70 billion in long term bonds with the Securities and Exchange Commission.
 
The bonds will have a tenor of 10 years or more and will be issued over a three year period with the first tranche to be floated in the third quarter of the year.
 
“Overall, we are committed to earmark P60 billion annually over the next three years to achieve our development roadmap and income targets by 2018. We are confident that, with your support, we are on our way to realizing our vision,” said SM Prime President Hans T. Sy.
 
SM Prime is aiming to double its net income to P32 billion by 2018 from P16 billion in 2014 when the SM group consolidated all of its property businesses under SM Prime.
 
Sy said that, while earnings started the year a bit slow, it began to pick up in February and “April is still very much on track.”
 
He said the firm will continue to build new malls while expanding existing malls. For this year, SM Prime will open new malls in Trece Martires in Cavite; San Jose del Monte, Bulacan; Cherry Congressional; Cherry Antipolo; and East Ortigas.
 
SM Prime will also be redeveloping portions of its Mall of Asia complex, investing P1.5 billion to increase its retail area to 700,000 square meters — making it the biggest mall in the country.
 
Also up for expansion is SM Clark in Pampanga which will be expanded to include office space for the business process outsourcing sector.
 
For its residential development business, SM Prime chairman Henry Sy, Jr. said they will be expanding their product offerings from their core offering of affordable condominiums.
 
“We will be moving up and below that range,” Sy said explaining that they will develop mid-rise buildings with about two to three bedrooms per unit as well as house and lots worth about P1 million for the economic housing segment.
 
Lim said they intend to launch about 2,000 units for the economic housing market out of the total 12,000 to 15,000 residential units they plan to launch this year.
 
Sy said SM Prime is also evaluating areas in the ASEAN region “to see where we will get the most opportunities.”
 
Lim said SM Prime is getting proposals for projects in other countries since it is making a name for itself as an integrated property company.