SM Prime returns to bond market with P25-B fresh offer
Real estate giant SM Prime Holdings Inc. is all set to return to the debt market this month after pricing its P25-billion bond offer meant to bankroll a massive expansion plan across its business segments.
In a stock exchange filing on Monday, the Sy family-led developer said the Series Y bonds due in 2028 were priced at 6.0282 percent per annum, Series Z bonds due 2031 at 6.2113 percent, and Series AA bonds due 2035 at 6.4784 percent.
SM Prime’s offer has a base amount of P20 billion with an oversubscription option of up to P5 billion in case of high demand. The bonds will be offered from Feb. 12 to Feb. 18.
The issuance, which represents the second tranche of the company’s P100-billion shelf registration program approved in June 2024, comes as SM Prime works to beef up its expansion war chest.
Last week, the developer said it would spend P33 billion this year to widen its portfolio of malls, hotels and offices amid growing foot traffic and a booming tourism industry.
SM Prime is setting aside the bulk of the total, or P21 billion, to expand its mall gross floor area by 205,400 square meters (sq m). At the same time, it will redevelop 124,488 sq m of existing mall space.
Meanwhile, P6 billion will go to the construction of two convention facilities and new restaurants, as well as renovation of hotel rooms.
The remaining P6 billion will be used to develop new office towers and work spaces as lease takeup increases.
Its office inventory includes Six E-Com Center, a two-tower development within the Mall of Asia Complex in Pasay City that mainly houses business process outsourcing firms.
In all, SM Prime plans to spend up to P110 billion this year as it also seeks to venture into both the affordable and high-end residential segments under SM Residences.
In the first nine months of 2024, SM Prime’s net income jumped by 12 percent to P33.9 billion due to growth in its mall segment. Revenues during the period likewise expanded by 8 percent to P99.8 billion.
