SM Prime Holdings Inc., the country’s largest integrated property developer, plans to raise up to P70 billion in fresh capital over the next three years from the issuance of retail bonds.
SM Prime executive vice president Jeffrey Lim said in an interview at the sidelines of the annual stockholders’ meeting Tuesday the company was finalizing plans to file a shelf registration with the Securities and Exchange Commission for the issuance of between P50 billion and P70 billion worth of retail bonds over three years.
Several companies that earlier availed of the shelf registration program of the SEC were Ayala Land Inc., DMCI Homes and San Miguel Corp.
Lim said the company would initially issue P10 billion in the third quarter of 2016. The company is looking at a 10-year tenor for the fund raising activity.
SM Prime plans to use proceeds from the planned bond offering to finance the aggressive expansion projects to help achieve a target to double the net income to P32 billion by 2018.
“We are committed to earmark P60 billion annually over the next there years to achieve our development roadmap and income targets by 2018,” SM Prime president Hans Sy said.
Under a five-year plan, SM Prime aims to build 85 malls by 2018, including 74 in the Philippines and 11 in China.
SM Prime plans to nearly double its residential projects to 41, offering a total of 140,000 units. It also aims to build 10 hotels by 2018.
Lim, meanwhile, said SM Prime would launch 2,000 house and lot units this year, or less than 20 percent of the 12,000 to 15,000 total residential units it planned for the year.
Depending on the demand, Lim said the company could increase the launch of house and lots next year to 5,000 units.
Lim said the the company was joining the house and lot segment of the market with units costing around P1 million as part of the company’s strategy to diversify product offerings.
SM Prime through residential arm SM Development Corp. first started as developer of affordable high-rise condominium buildings.
Aside from venturing into subdivisions, the company plans to venture into mid-rise developments and high-end residential towers.