SMDC to build 20,000 units in shift to mid-rise projects

SM Development Corp., the residential arm of SM Prime Holdings Inc., has shifted focus to developing mid-rise and horizontal housing projects to adapt to the reduced purchasing power of homebuyers amid the pandemic.

SMDC president Jose Mari Banzon said in a news briefing following the company’s annual stockholders meeting the company would launch 12,000 to 20,000 units in mostly medium-rise buildings this year.

Banzon said the mid-rise buildings would be built mostly in provinces near Metro Manila, while the horizontal projects would be in provincial areas with SM malls. These units are priced below P3.2 million each.

“With the pandemic and war in Ukraine, many Filipinos have been dislocated and destabilized. We want to have a product that Filipinos can afford, considering that many of them have reduced income now,” Banzon said.

He said the company would also take a pause on high-rise developments as this segment would account for a small portion of launches this year.

Meanwhile, the company’s strategy of offering medium-rise buildings outside Metro Manila is expected to boost sales to the overseas Filipino market.

SM Prime president and chief executive Jeffrey Lim expressed optimism about company’s this year after the government lowered the alert level in most areas in the country.

Lim said while the company continued to give concession to tenants, it could now slowly scale back on these concessions as foot traffic improved.

He foot traffic in shopping malls during the weekends went back to pre-pandemic levels, while weekday foot traffic was about 80 percent to 85 percent of pre-pandemic level.

The company believes that foot traffic will further improve once workers go back to offices, he said.

SM Prime earmarked P80 billion in 2022 capital expenditures primarily to finance the construction of new malls and residential projects and land banking activities.

SM Prime will open four malls this year, located in Roxas City, Tuguegarao, Sorsogon and Tanza.

The share price of SM Prime rose 0.28 percent Monday to close at P36.15.