SM spending P975M to expand two malls (BusinessWorld)

Published in the October 28, 2005 issue of BusinessWorld

Today’s Headlines

BY JENNEE GRACE U. RUBRICO, Senior Reporter

SM spending P975M to expand two malls

The SM group of companies is spending almost a billion pesos to expand two malls.

A group insider told BusinessWorld the expansion of SM City North Edsa in Quezon City and SM Supercenter Sucat in Parañaque has a tag of around P975 million.
"The funds will be raised through internally generated cash," the source said.
The two new buildings will be opened next year, with construction costs at P13,000 per square meter.
For SM North, one of the biggest malls of the group, the company will add another 50,000-square meter building.
The mall, which was opened in 1985 and located at North Avenue and EDSA, has a land area of 16.1 hectares and a current gross floor area of 275,419 square meters. Its anchor tenants are the SM Department Store, SM Cinemas, Super Sale Club, SM Food Court, SM Supermarket, SM Bowling Lanes.
SM Sucat, meanwhile, will add a second building which will have a gross area of 25,000 square meters.
The mall stands on a 6.5-hectare property along A. Santos Ave. and currently has a total floor area of 66,150 square meters.
SM Hypermarket, SM Cinemas, SM Food Court are the anchor stores.
The company source said the new buildings will likely be used as mall space rather than call centers. He also said talks with locators have begun, but added that the tenant mix has yet to be finalized.
The new space in the two malls will form part of the additional shopping space SM is planning to build next year. SM is also set to open four malls in 2006 -the 60-hectare SM Mall of Asia and much smaller malls in Sta. Rosa, Laguna, Lipa, Batangas, and Clark.
Yesterday, SM also opened its 21st store, the 61,000-square meter SM Supercenter Valenzuela. Another SM mall, the 48,000-square meter SM Supercenter in Molino, Cavite, will also be opened before yearend.
Company officials said there are no plans to close any SM outlets, even though some of the malls -- particularly the one in Bacoor and the soon to be opened branch in Molino -- are near each other.
SM’s mall developer and operator, publicly listed SM Prime Holdings Inc., posted a net income of P2.41 billion in the first half, up from P2.23 billion in the same period last year, due mainly to rental income from leases in the malls and food courts. Revenues, meanwhile, rose to P5.19 billion from P4.92 billion last year.