SM Prime to introduce its residential product in China
MANILA - Integrated property developer SM Prime Holdings Inc. is introducing its residential product in China in a year’s time, marking the first international foray for SM Development Corp. (SMDC).
SM Prime executive vice-president and chief finance officer Jeffrey C. Lim said the company will launch a high-rise condominium project in the world’s most populous nation “in a year or so.”
“We’re trying to do one in Chengdu but it’s still in the planning stage,” Lim said. SM City Chengdu in Sichuan province opened in October 2006 with anchor tenants Walmart, Laiya Department, Wanda Cinema, Gome, KFC and Watsons.
SM Prime is still hopeful of a good performance for SMDC despite the Chinese government’s property curbs aimed at cooling down the property market.
“We’re positive about our development because it is within the vicinity of a mall,” Lim said.
“Our plan right now in China is to do malls and extend that to the residential side,” Lim said.
The SM Group, which has already established a brand in China, targets the middle class for its residential offering, Lim said.
SMDC had planned tos venture into China a few years ago. However, Lim said the SM Group focused on the consolidation of its property units.
In May 2013, the SM Group merged mall developer SM Prime, residential builder SMDC, private firm SM Land Inc. and upscale Tagaytay Highlands developer Highlands Prime Inc. in a P279-billion transaction that created the country’s largest integrated property firm.
For Southeast Asia, the SM Group is exploring opportunities in Myanmar and Indonesia, Lim said.
However, SMDC will still focus on the Philippines, where it has evolved into one of the country’s largest condominium builders. “We’re launching in the second half six towers totaling 11,000 units,” Lim said.
SM Prime is doubling its income and revenues in the next five years as it grows its office, mall, leisure, hotel and residential portfolio by two-fold in the same period. It allotted P400 billion in the medium term to support its expansion in the Philippines, in China and in Southeast Asia.
Strong rental and residential revenues allowed SM Prime to post a 12-percent jump in net income to P9.8 billion in the first half while revenues rose seven percent to P33.42 billion from a year ago.