SM PRIME Holdings, Inc. plans to keep capital expenditures steady this year, with the second tranche of its bond offering set for launch to bankroll its spending program.

SM Development Corp. launched Cheer Residences within the SM City Marilao complex in Bulacan in the fourth quarter of 2016. — COURTESY OF SM DEVELOPMENT CORP.

SM Prime Vice-President for Finance Teresa Cecilia Reyes-Agsalud said in telephone interview the integrated property developer owned by Henry S. Sy, Sr. set a 2017 capex budget of between P50 billion and P55 billion, bulk of which will be allocated for its shopping and residential businesses.

“It’s just the same compared to the P53 billion spent last year,” Ms. Agsalud said.

To finance part of the capex, SM Prime will undertake another bond offering worth anywhere between P10 bilion and P15 billion within the year, Ms. Agsalud said.

SM Prime raised P10 billion from the sale of the peso-denominated, 10-year Series F retail bonds at 4.2005% per annum in late July. The debt notes received a PRS Aaa credit rating from the Philippine Rating Services Corp.

The real estate firm secured regulatory clearance for a shelf registration of P60 billion worth of fixed-rate bonds that may be issued in tranches within three years from approval.

SM Prime is finalizing the new projects slated for launch this year, the official said.

SM Prime is in the fourth-year of its five-year road map that aims to double revenues and profits by 2018.

“In terms of the number of unit launches and expansion, we are on track (with our five-year plan),” Ms. Agsalud said.

SM Prime targets to have developed 10.96 million square meters of shopping malls, 139,000 residential units in 41 projects; 2,500 leisure homes in 16 developments; 460,000 square meters of leasable space in seven office buildings; and 2,187 rooms in 10 hotels by 2018.

In the Philippines, SM Prime has 60 malls with the recent opening of SM City East Ortigas in Pasig City last Dec. 2 with a gross floor area (GFA) of more than 80,000 square meters (sq.m.); SM Cherry Congressional in Quezon City last Nov. 25 with more than 13,000 sq.m. in GFA; SM City San Jose Del Monte in Bulacan last April with 101,000 sq.m. in GFA; and SM City Trece Martires in Cavite last May 2016 with 84,000 sq.m. in GFA.

SM Prime soft-opened its 565,000 sq.m. property in China on Dec. 17, with a combined gross floor area GFA of 1.5 million sq.m., bringing its combined GFA to 9.1 million sq.m. both in the Philippines and in China.

SM Prime is part of SM Investments Corp., the holding company for Mr. Sy’s core businesses such as banking, real estate and retail. The group has ventured into other sectors like gaming, mining and infrastructure.

In the first nine months, a sustained growth in rental operations and real estate sales allowed SM Prime to generate revenues amounting to P57.8 billion or 11% over last year’s P52.2 billion. Its net income accordingly rose 13% to P17.5 billion from P15.5 billion.