SM Prime eyes high-end residential market
SM Prime Holdings Inc., one of the largest integrated property developers in Southeast Asia, is setting its sights on the premium residential market—a move seen to sustain its growth momentum and further strengthen its leadership in the Philippine real estate sector.
In a recent disclosure to the Philippine Stock Exchange, SM Prime reported that this was part of the company’s strategic reformat to expand its portfolio to optimize revenue mix across key business units and gain stronger foothold in underserved markets and high growth sectors.
‘SM Residences’
This reformat entails, starting next year, the consolidation of all residential projects under the new “SM Residences” brand, which will cover a range of offerings from economic and medium-cost projects to premium and leisure developments.
SM Prime said it has already earmarked over 1,000 hectares for its SM Residences projects, slated for development over the next five years. Around 85 percent of this landbank will be allocated for its planned horizontal developments.
SM Residences’ premium line, in particular, is slated for launch early next year, along with its 200-hectare flagship high-end project.
More projects of different formats with prices ranging from P25 million to over P100 million are likewise being planned and pipelined to address the growing demand in the different sub-markets of the high-end segment.
“Our growth over the past 30 years has been largely driven by our market leading
position in the mall and retail segment. As we move forward, our goal is to unlock the full potential of our extensive land bank through SM Residences and more integrated developments. This will enable us to sustain long term growth across a broader business portfolio,” SM Prime president Jeffrey Lim said in the disclosure.
Timely pivot
This pivot is proving to be timely as well, as it is aligned with policy developments including the increases in housing loan ceilings, as announced by the National Economic and Development Authority (Neda) and the Department of Human Settlements and Urban Development (DHSUD). According to a joint circular, the maximum housing guarantees for low and medium-cost housing have been raised to P4.9 million and P6.6 million, respectively.
This adjustment supports SM Prime’s ability to cater to broader market segments while contributing to reducing the country’s housing deficit.
“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,” Lim said.
Growth and innovation
SM Prime’s focus on premium developments comes as it builds on a solid financial foundation.
In the first nine months of the year, SM Prime reported a 12 percent increase in consolidated net income to P33.9 billion, with revenues rising 8 percent to P99.8 billion. The mall segment remained the primary growth driver, contributing 57 percent of the company’s consolidated revenues.
Since becoming the first Philippine company to exceed the P1 trillion in market capitalization in 2017, SM Prime has continued to demonstrate its ability to adapt to evolving markets. Through this latest move, the company is out to further cement its leadership in the industry.
Unlocking new opportunities
Indeed, the launch of SM Residences premium projects is seen to redefine the luxury residential landscape, combining the developer’s expertise in building thriving integrated lifestyle communities. Investors and homeowners can look forward to exceptional value in residences designed to set new benchmarks for exclusivity and sophistication.
With its expertise, financial muscle, and clear vision, SM Prime is no doubt a strong player in high-end real estate, catering to the lifestyle aspirations of the country’s most discerning buyers and investors.
