MANILA, Philippines – Ilocanos and other Filipinos in the northern province of Ilocos Norte will be unable to have Christmas celebrations in the much-awaited SM City in Laoag.
The Philippines’ largest mall developer, SM Prime Holdings Corporation (SM Prime), chaired by Henry Sy Jr., confirmed this week that the P2.4 billion mall, will not open this year as it had hoped in February.
SM City Laoag, located in Laoag-Paoay Road, will instead open in 2025. The SM group had planned to launch it in October this year, two months before the peak of the Christmas season. Later, there were reports saying it would open in December.
Last August, SM Supermalls had teased the mall’s interiors, saying SM City Laoag was inspired by the city’s coastal desert and would celebrate local heritage and culture.
SM City Laoag, with a gross floor area of 113,000 square meters, will have a 3-story shopping mall, a basement, and a roof deck parking. It will also have a transport terminal.
Aside from SM City Laoag, SM Prime will also open SM City La Union, SM City Zamboanga, and SM City Sta. Rosa, Laguna for a total of four malls in the Year of the Snake. SM Supermalls had planned to open these three malls in 2024.
SM Prime did not give a reason for moving back the mall openings, but the series of tropical storms in the Philippines this year, especially in the north, may have played a role. SM Prime has not replied to Rappler’s queries as of writing.
SM Prime opened three malls in 2023: SM City Bataan in Central Luzon; SM Center in San Pedro, Laguna (fourth in Laguna province); and SM City Sto. Tomas, Batangas.
SM’s mall expansion is now outside Metro Manila as the regions post strong growth. “The focus is to cover most of Northern Luzon, Visayas, and the progressive cities in Mindanao,” SM Prime said in a statement on Friday.
Instead of four mall openings in 2024, SM Prime launched only two: SM City Caloocan and SM City J Mall in Cebu.
SM City Caloocan, SM Supermalls’ third in Caloocan City and its 86th mall in the Philippines, opened last May.
SM Prime’s 87th mall — the Japanese-themed SM City J Mall, its fourth in Mandaue City in central Philippines — opened to the public last October 25.
SM Prime 3rd quarter earnings
SM Prime’s malls business generated P56.4 billion in the first nine months of 2024, 8% higher than the P52 billion in the same period last year.
Prior to the opening of SM City J Mall, SM’s 86 malls in the Philippines had an average daily pedestrian count of 3.7 million. They had 23,307 tenants, 393 cinema screens, and over 90,000 car park slots as of third quarter this year.
SM Prime also has 8 malls in mainland China with an average daily pedestrian count of 300,000.
SM Prime said it has an available landbank in the Philippines of more than 360 hectares for mall development in the next five to seven years.
This year, SM Prime has spent P60 billion for its various projecrts — 40% on malls; 26% on residential developments; 13% on offices, hotels, and convention centers; and 21% on coastal develpoments. It expects that its capital expenditures this year would be “within P100 billion.”
It is eyeing to spend P110 billion for its projects in 2025.
SM malls and residences contributed 64% or nearly two-thirds to SM Prime’s net income of P34 billion in the first nine months of 2024, 12% higher than its P30 billion net income in 2023. Revenues reached P100 billion in the same period, 8% higher than the year prior.
More focus on low- and high-end market
Meantime, SM Prime said in a disclosure on Friday that it would consolidate all its residential projects under the SM Residences brand, which would then cover offerings from “economic, medium-cost, premium and leisure developments.” This means its well-known SM Development Corporation or SMDC would be folded into SM Residences.
SM said the move “coincides with its long-term plan to gain a stronger foothold in underserved markets and high-growth sectors, including premium and integrated development.”
It also comes after the National Economic and Development Authority (NEDA) and the Department of Human Settlements and Urban Development (DHSUD) raised the guaranty ceiling for low- and medium-cost housing packages to P4.9 million and P6.6 million, respectively.
This was in response to the request of the Subdivision and House Developers Association (SHDA) to adjust the ceiling due to rising cost of materials and labor. It said the revised ceilings would make it easier for prospective buyers to own a home.
“The price adjustments will allow us to target a broader segment of the housing market. It will also enable us to better address the growing demand for affordable and quality housing, while contributing to the government’s efforts to reduce the housing backlog,” said SM Prime President Jeffrey Lim.
SM Prime’s residential business had an inventory of 26,121 unsold units as of third quarter of 2024, compared to only 4,256 unsold units in the same period in 2023.
Starting in 2025, SM Prime will launch SM Residences’ premium line, which would mean stronger competition in the high-end real estate market.
“More projects of different formats with prices ranging from P25 million to over P100 million are likewise being planned and pipelined to address demand in the different sub-markets of the high-end segment,” SM said.
SM Prime said it has set aside over 1,000 hectares of land for its SM Residences projects in the next five years, with around 85% of earmarked for horizontal development. – Rappler.com
