SM Prime Holdings Inc. (PSE:SMPH), one of Southeast Asia’s largest property developers, has unveiled an ambitious ₱100 billion capital expenditure (capex) plan for 2025. The company aims to leverage anticipated growth in consumer demand and corporate activity—fueled by election-related spending, easing interest rates, and higher tourism inflows—to drive its next phase of expansion.
SM Prime President Jeffrey C. Lim outlined that the company’s growth will be anchored by its mall business, while a robust project pipeline will enhance strategic initiatives across its diversified portfolio. “These planned investments position us to meet evolving customer needs while driving SM Prime toward its next phase of growth,” Lim stated.
Key Investment Areas for 2025
- Malls Expansion
A ₱21 billion allocation is set aside to expand the gross floor area (GFA) of SM Prime’s mall portfolio. This includes adding approximately 205,400 square meters of new GFA and redeveloping around 124,488 square meters of existing mall space. The company aims to push its total mall GFA beyond 8 million square meters by year-end. - Residential Projects and Integrated Property Developments (IPDs)
The largest portion of the capex, ₱67 billion, will fund SM Residences and IPDs. These projects include a mix of regional, premium, and leisure residential developments along with large, mixed-use, master-planned urban centers in Luzon and Visayas. - Office, Hospitality, and MICE Upgrades
A ₱12 billion budget will support the expansion and improvement of SM Prime’s office, hospitality, and MICE (meetings, incentives, conferences, and exhibitions) segments. This funding will facilitate the construction of two new convention facilities, renovations of hotel rooms, and the addition of food and beverage outlets. New office towers and workspaces, including the Six E-Com Center at the Mall of Asia Complex, are also on the agenda, driven by strong tenant demand.
SM Prime’s plan follows a strong performance in 2024, when the company recorded record net income of ₱45.6 billion—a 14% increase from 2023—and consolidated revenues reaching an all-time high of over ₱140 billion. These results were bolstered by higher rental income, real estate sales, and enhanced revenue from diversified services.
In parallel with its capex investments, SM Prime is also expanding its mall footprint with the opening of three new malls in La Union, Ilocos Norte, and Zamboanga City. This move aims to broaden its retail network and capture increased consumer spending driven by a growing middle class and robust remittance inflows.
The ₱100 billion investment plan reflects SM Prime’s confidence in a sustained economic recovery. Key factors supporting this outlook include:
- Increased public and private sector expenditures during the electoral period are expected to stimulate consumer activity.
- Lower financing costs may spur investments in both commercial and residential real estate sectors.
- An anticipated upswing in tourism spending is likely to benefit retail, hospitality, and leisure segments, reinforcing the company’s diversified revenue streams.
By strategically distributing its capex across malls, residential projects, and mixed-use developments, SM Prime is positioning itself to not only capture emerging opportunities but also to mitigate sector-specific risks. Investors and industry analysts will be closely monitoring the execution of this plan, which could further solidify SM Prime’s leadership in the Philippine property market during a period of renewed economic momentum.