SM Prime Holdings Inc. is set to launch its own real estate investment trust (REIT) in the second half of the year. Its assets will initially include some of SM Group malls and would be the country’s biggest.
Jeffrey C. Lim, SM Prime president, said the enterprise looks to raise $1 billion or P55.5 billion in local currency.
Total valuation would be around $4 billion or four times bigger than the listed RL Commercial REIT Inc.
“It’s purely initially shopping centers. We actually have the portfolio details but we’re still doing some evaluation with bankers. But I think the key really is the timing because you know, interest rates are still very volatile. We want to make sure that when we launch something that is sustainable, and that we can deliver our commitments,” Lim said at the sidelines of the company’s annual stockholders’ meeting.
SM Prime owns 82 malls across the Philippines at the moment.
Proceeds from the REIT listing will be used to finance the reclamation of 360 hectares of land in Pasay City across where SM Mall of Asia stands.
The enterprise will spend $2 billion for the reclamation which would take three years to complete.
This new reclamation project will link the Mall of Asia Complex which also sits on reclaimed-land.
Pasay City is the SM Group’s joint venture partner and will undertake the development of the actual raw land reclamation and the horizontal development works. The company has finalized the selection of consultants and contractors from a roster of reputable companies with proven reclamation and dredging experience to ensure the project’s proper implementation.
SM Prime is also scheduled to open three new malls and expands certain other malls this year, which will provide an additional 200,000 square meters of gross floor area. The new shopping malls are in Bataan, San Pedro in Laguna and Sto. Tomas in Batangas.
