SM Prime Holdings, Inc., one of the largest integrated property developers in Southeast Asia controlled by the Sy Group, is setting aside about P100 billion in capital expenditures for 2026, matching last year’s outlay while sharpening its focus on returns after posting a 7 percent rise in 2025 profit.
SM Prime President Jeffrey C. Lim said the spending plan would remain substantial but more deliberate. Every peso deployed, he noted, must generate clear value for stakeholders. The company will not trim or delay projects for conservative cost reasons, but it will ensure capital is allocated efficiently and backed by strong return visibility.
The strategy follows a year of modest top-line growth but firmer profitability. Net income climbed to P48.8 billion in 2025 from P45.6 billion a year earlier, supported by stronger commercial property revenues and tighter cost controls. Consolidated revenues edged up to P141.1 billion from P140.4 billion.
Malls continued to anchor performance, contributing P85.1 billion or 60 percent of total revenues. Residential developments accounted for P42.5 billion, while hotels and convention centers delivered P8.5 billion. Offices and warehouses added P5.4 billion. Commercial property revenues overall rose more than 6 percent to P98.6 billion.
Operational discipline proved pivotal. Total costs and expenses fell 4 percent to P69.4 billion, driven by lower operating expenses, film rentals and insurance costs. In the fourth quarter, net income held steady at P11.6 billion even as revenues slipped 7 percent, as a nearly 12 percent drop in costs cushioned the decline.
Capital expenditures in 2025 reached P81.9 billion, slightly higher than the previous year, with most funds channeled to mall, residential and estate developments.
Early 2026 indicators suggest steady consumer activity in malls, with foot traffic and tenant sales tracking expectations. Combined with a net debt-to-equity ratio of 46 to 54 and interest coverage of 6.61 times, the balance sheet leaves room for expansion.
By holding spending flat but tightening execution, SM Prime is signaling a pivot toward calibrated growth, seeking to translate scale and market dominance into more durable returns.
