Property firm SM Prime Holdings Inc. plans to expand into Southeast Asian markets, like Thailand and Malaysia, to seize the opportunities offered by the forthcoming Asean economic integration.
SM Prime COO John Ong announced plans to expand outside the Philippines and China during an investors’ conference organized by the Bank of Philippine Islands.
“Apart from China, because there is certain affiliation in China, but we continue to accept, we continue to receive invitations in other Asean countries like Thailand and Malaysia. So we continue to entertain those opportunities and we look at synergy,” Ong said.
He said they are looking to expand within the business segments the conglomerate is engaged in, particularly malls and residences.
“We continue to entertain those opportunities. We would definitely entertain [these] and we would be glad to go to other areas in the Asean region,” he added.
With the establishment of an Asean Economic Community (AEC), the region will be characterized by free movement of goods, services and investments, as well as freer flow of capital and skills.
The Asean groups Indonesia, Malaysia, the Philippines, Singapore, Thailand, Brunei Darussalam, Vietnam,
Lao PDR, Myanmar and Cambodia.
Ong stressed that the expansion plan is not yet factored in SM Prime’s five-year road map to double its income to P32 billion by 2018.
The firm allotted P400 billion in capital expenditures until 2018 to grow its office, mall, leisure, hotel and residential portfolio by twofold.
It will construct 26 new SM malls and 20 residential projects in the Philippines and six malls in China. SM Prime will also expand its offices, hotels and leisure businesses.
Ong said he expects no change in terms of revenue mix from the current levels, as SM Prime works to double its income.
“We expect that we will continue with the 60-percent revenue contribution coming from our malls, 30 percent coming from our residential and the rest should be coming from our commercial and the hotel and convention centers. In the next four years leading to 2018, we are looking at the same trend in terms of revenues,” he added.