SM to slow down opening malls in China — Hans Sy

Due to the competitiveness issue, SM Prime Holdings Inc. (SM Prime) top official Hans Sy disclosed that they are slowing down the opening of more malls in China.

Sy, Chairman of the SM Prime Executive Committee said they are on track to open more regional branches, completing their target to open 100 stores by 2027.

“You know why? Because a lot of people don’t know the real secret of the Philippines, that is, we have so many islands. So, we are making it convenient by going to them rather than letting them come over. We are opening more branches outside Metro Manila,” Sy said in an ambush interview after he was bestowed the “President’s Award” at the Philippine Retailers Association Awards night in Solaire North, Wednesday night.

“Overseas, we are slowing it down like in China. It’s very challenging right now in China. While China is still something that we look forward to, it’s very competitive there. It’s a different ball game. We just want to be sure that we are financially strong,” he said.

As of May 2024, SM Supermalls has a total of 96 branches, 88 are located in the Philippines, while the remaining eight are in China, particularly in the cities of Xiamen, Jinjiang, Chengdu, Zibo, Chongqing, Tianjin, Suzhou and Yangzhou.

Currently, SM Prime has 13 malls under construction.

WPS tensions not a challenge

Regarding continued geopolitical tensions between the Philippines and China, particularly in the West Philippine Sea, Sy said that doesn’t affect the SM Group’s dealings with Chinese investors.

“I (actually) met with investors and explained to them, and showed them the political chart of the Philippines, and told them that it is up and down. I superimposed our growth, which is upward. What I am trying to show investors is that as long as you don’t join politics, then you won’t be affected,” he said.

“With the geopolitical tensions, as we always say, humans do understand the consequences and I am sure they have seen what is going on with Ukraine and Russia, Gaza and Israel, I am sure everyone would be more careful,” the SMPH official added.

Bullish on SM Group

He said investors remain bullish on the SM Group as it presents its growth numbers.

In a disclosure at the Philippine Stock Exchange, SM Prime posted a P40 billion consolidated net income in 2023, 33 percent higher than P30.1 billion in 2022.

The Company’s 2023 consolidated revenues were P128 billion, 21 percent higher than the previous year’s P105.8 billion.

SMPH is an integrated property developer and a public subsidiary of SM Investments Corporation.

“So, whether you’re looking at the retail, mall, or banking, our numbers remain consistent, thanks to my team for working so hard,” said Sy.

SMPH was incorporated in January 1994 to acquire and develop real estate, conduct and maintain commercial shopping centers, including shopping center spaces for rent, amusement centers, movie or cinema theaters and construct and manage buildings such as condominiums, apartments, hotels, restaurants, stores and other structures for mixed-use purposes.

The company has four business units, that is, malls (SM Supermall), residential (SMDC), commercial (CPG), and hotels and convention centers (SMX).

Also, SM Prime has 67 residential projects, 18 commercial projects, 10 hotels, six convention centers and two trade halls.