SM Prime unit to tap offshore debt market
Real estate giant SM Prime Holdings Inc. (SMPHI) will soon tap the offshore bond market as it ramps up the expansion of its portfolio, particularly through the construction of new flagship malls.
The Sy family-led developer on Monday disclosed that it had tapped HSBC, JP Morgan, Standard Chartered Bank and UBS as joint lead managers and joint bookrunners, along with BDO Capital and Chinabank Capital as joint domestic managers. They will arrange a series of fixed-income investor calls in Asia and Europe.
According to SM Prime, a dollar-denominated benchmark-sized Regulation S offering by subsidiary SMPHI SG Holdings Pte. Ltd. may come after the meetings.
Although it did not disclose a definite timeline for the offer, SM Prime said the notes would mature in five years and would be drawn from SMPHI’s $3-billion Euro Medium-Term Note (EMTN) program.
Regulation S senior notes refer to debt securities offered and sold outside the United States. Its name comes from Regulation S of the US Securities Act of 1933, which stipulates the rules on offers and sales made in other countries.
Meanwhile, EMTNs, are issued outside the United States and Canada. These give issuers the flexibility to tailor their debt issuance to their specific funding needs. They likewise enable companies to tap more international investors, particularly those looking for Euro-denominated debt.
Last year, SM Prime and parent firm SM Investments Corp. jointly raised $500 million from an overseas bond offer. This marked their largest bond issuance abroad in a decade.
Five flagship malls
SM Prime’s announcement comes after its subsidiary, SM Supermalls, announced plans to open five flagship malls through 2030. These will be built in Sta. Rosa, Laguna (2026), Harrison Plaza in Manila (2027), Malolos in Bulacan province (2028), Cavite province (2029) and Pasay City (2030).
The firm also plans to spend P150 billion in the next five years for the redevelopment of 16 existing malls and the construction of 12 new lifestyle malls.
SM currently has 88 shopping malls in the country, with SM La Union set to open in October, according to SM Supermalls president Steven Tan.
Despite having to delay the opening of SM Zamboanga to the first quarter of 2026, he said they were “still aiming” to have 100 malls by 2027 or 2028 and 115 malls by 2035.
As for redevelopments, the SM Group is currently working on upgrades to SM Megamall, one of its largest flagship malls in the country, for P7 billion.
SM North Edsa in Quezon City will also be given a facelift for around P9 billion, while SM City Seaside Cebu, SM Lanang in Davao City and SM City Clark in Pampanga province are also lined up for redevelopment.
