SM's 'Future City' rising in reclamation area

Posted at 09/02/14 7:39 AM

MANILA - Property developer SM Prime Holdings Inc. on Monday said it may integrate its reclamation project in the cities of Pasay and Parañaque to create a “future city” with a combined size of 600 hectares near Manila Bay.

Hans Sy, SM Prime president, told reporters that the reclamation project may cost over P100 billion to complete and the company has already contracted AECOM Technology Corp. for the master plan of the development.

“We’re now doing a master planning. Give us a few months; I think we can make a nice announcement about what we can do. We’re working with them [AECOM] very closely; we give them the ideas on what we want to do. We now have to justify the whole design, including putting into consideration all the environment and climate-change issues. All the issues should be addressed,” Sy told reporters at the sidelines of the company’s P20-billion bond listing at the Philippine Dealing & Exchange Corp.

The reclamation project, with 300 hectares each in the Pasay and Parañaque areas, will be six times the size of the SM Mall of Asia Complex in Pasay, a development that started way back in the 1990s.

Sy, however, said SM Prime will only become the private contractor of the project. The company was able to bag the contract when the two cities issued to the public their respective proposals.

The said project, however, will first have to hurdle several approvals from various agencies, from the Philippine Reclamation Authority all the way up to the National Economic and Development Authority (Neda), which approves big-ticket projects above P5 billion. The Neda Board is chaired by President Aquino.

“Well, because currently Metro Manila is so densely populated, there’s just so many things that we do. And any major acquisition and development, it will really affect the whole. So we would rather put up a totally new one and be able to input all those new designs into it, integrate everything including traffic studies. That’s why we call it a future city,” Sy said.

He said the company may come up with the master plan of the project within three to six months from now.

Last week the Paranaque Public Private Partnership Selection Committee endorsed SM Land Inc.’s P54-billion proposal to reclaim and develop 300 hectares of land in its portion of Manila Bay. In December, the Pasay City Council also approved SM Land’s P54.5-billion proposal, also for the reclamation and development of 300 hectares of land in its portion of the Manila Bay.

SM Land is a unit of SM Prime.

SM Prime on Monday has upsized its maiden retail-bond issue to P20 billion from the initial size of P15 billion due to the strong demand from both retail and institutional investors. The bond consists of the 5.1-percent series A bonds due 2020, 5.2006-percent series B bonds due 2021 and the 5.7417-percent series C Bonds due 2024.

“The strong market response prompted the joint issue managers and joint lead underwriters to exercise the company’s oversubscription option,” the company said.

In Photo: Gema O. Cheng (from left), senior vice president of SM Prime Holdings Inc.; Teresa Cecilia Reyes, vice president for finance of SM Prime Holdings Inc.; Jeffrey C. Lim, executive vice president of SM Prime Holdings Inc.; Hans Sy, CEO and president of SM Prime Holdings Inc.; Alexander Pomento, vice president for investor relations, SM Prime Holdings Inc.; and Antonio Nakpil, president and COO of Philippine Dealing & Exchange Corp., at the bell-ringing of the new listing of SM Prime Holdings Inc. for fixed-rate bonds worth P20 billion, which is due in 2020, 2021 and 2024. The bell-ringing was held at the PDS Group Assembly Hall on Monday. (Stephanie Tumampos)