Sy-led SM Prime eyes 5 more malls in China
MANILA, Philippines - The Sy group is eyeing 5 more malls in China, an official of its mall developer and operator unit said.
SM Prime Holdings, Inc. Chief Finance Officer Jeffrey Lim said the group is already in talks to keep their long term strategy of growing their portfolio of investments in China.
He added that these additional locations may probably closed one by one rather than all at once.
"We're still looking for opportunities. China is for the long term growth of the company which may be realized over 5 years. Currently, the China business is still only about 10% of the total," Lim said at the sidelines of Philippine Consumable market roundtable forum on Thursday, May 17.
Manpower, he said, remains an issue since language barrier prompts them to train Filipino managers first then send them to work in their China malls for two years.
The new locations would add to the company’s 4 malls in China. Apart from Xiamen and Jinjiang, SM Prime also operates in two other China locations, Chengdu and Suzhou, taking in a total gross floor area (GFA) of 645,172 square meters (sq.m) in that country.
This year, it plans to open a shopping mall in Chongqing, with a GFA of 147,446 sq.m. This will be followed in 2014 by SM Zibo with 154,000 sq.m, and its largest shopping center yet, SM Tianjin, with 540,000 sq.m.
Lim said the builder’s earlier announced expansion into Xinxiang City, in Henan province, may proceed within the year.
The expansion projects are part of the company’s strategy to list its China assets either in Hong Kong or Singapore by 2015 in a public offering valued at about $500 million, Lim said.
SM Prime’s 4 malls in China posted a 34% increase in revenues to P620 million, accounting for 9% of the company’s revenues in the first quarter of 2012.
He added that they are also looking at other countries but there are no serious talks as of the moment.
With all those plans for expansion outside the country, Lim said Philippines will still give the company growth in the next 3 to 5 years on the back of good prospects and rising disposable income of Filipinos.
"We're still going to focus in the Philippines. There have been changes in preferences of Filipinos and they are opening up to new trends. You see a lot of people buying new things than what they are used to," he said.
He added that SM Prime, by opening malls in the southern and northern part of the country, is developing more choices, better opportunities and entrepreneurs especially in the provinces. - Rappler.com