MANILA, Philippines – The Sy family’s SM Prime Holdings is investing up to P33 billion for its expansion plans in 2025, with a big chunk of the budget allocated for the expansion of its malls business.
“We expect moderating inflation, easing interest rates and election-related spending to fuel our growth in 2025. Our malls should do well and our office, hotel, and convention centers could provide additional upside,” SM President Jeffrey Lim said in a statement on Thursday, February 6.
The property giant plans to spend up to P21 billion to expand its malls to a total of 8.08 million square meters by the end of 2025.
New retail developments will add 205,400 square meters to its gross floor area. Meanwhile, 124,488 square meters of its existing spaces will get a face lift.
SM Prime’s mall business accounted for 57% of its consolidated revenues as of November 2024, when it booked P35.1 billion from the January-to-September period.
The company currently has 87 shopping malls in its portfolio. This year’s big investment was also made after SM Prime saw encouraging results in the past year — noting the increase in foot traffic in its malls.
From the same period in 2024, the company saw an increase in mall rental income by 8% to P48.5 billion. Spending on leisure and entertainment also grew by 4% — cinemas, event ticket sales, among others, totaled P8 billion.
Steven Tan, the president of SM Supermalls, said in an interview with the ABS-CBN News Channel (ANC) that they are opening three new malls in 2025: La Union, Laoag, and Zamboanga.
He noted that the “widening of the middle class” and the remittances from Filipinos abroad contributed to the retail giant’s positive numbers in the past year. A newer, younger generation of consumers is also spurring growth.
“The workforce, they don’t go back home and cook anymore, they just grab a quick bite and [maybe with] the problem of traffic in the National Capital Region, so they go to the mall and just have their dinners or lunches [there] rather than cook at home,” Tan said in an interview with ANC that first aired on January 9.
He added that consumers also appreciate the human interaction and experience when going to brick and mortar stores.
Meanwhile, SM Prime plans to allocate P6 billion each for its hospitality and its office business.
For its hospitality business, the company plans on building two new convention facilities and renovate hotel rooms. It is also eyeing new food and beverage stores in its existing hotels.
SM is planning to develop new office towers and work spaces. This includes Six E-Com Center, a two-tower, Grade A office complex that will be built within the Mall of Asia area to house tech firms and BPO companies. – Rappler.com