By Zinnia B. Dela Peña (The Philippine Star) Updated May 31, 2010 12:00 AM
MANILA, Philippines - SM Development Corp. (SMDC), the listed residential development arm of the SM Group, is looking to acquire properties in the booming Bonifacio Global City as it enters the high-end market.
Rogelio Cabunag, president of SMDC, said the firm is in the process of acquiring a nearly 4,000-square meter lot in Fort Bonifacio near St. Lukes as part of its landbanking activities.
Cabunag said the company plans to build a high-rise building with the construction targeted to start next year.
He said SMDC is scouring other areas for possible acquisition to further ensure long-term growth, using proceeds from the recently concluded P10-billion corporate notes issue, which was more than three times oversubscribed.
SMDC was originally looking to issue P5 billion but upsized it to P10 billion on strong demand. BDO Capital & Investment Corp. was the lead arranger.
Cabunag also disclosed that the SM Group, which currently owns 80 percent of SMDC, is considering divesting an initial five percent of its holdings to boost the listed firm’s public float. He said several entities have offered to arrange the transaction, which could take place within the year.
In the first quarter this year, SMDC reported a 51-percent jump in net earnings to P632 million, preselling a total of 3,547 units or 294 percent higher year on year. Total sales reached P7.2 billion, up 192 percent from the previous level.
SMDC has 12 ongoing residential projects, of which 11 are in key areas within Metro Manila, and one is in the mountain resort city of Tagaytay.
For this year, SMDC is launching four new projects which will entail between P4 billion and P8 billion in funding requirements. These new projects are located in various strategic sites in Taft, Manila; Ortigas in Pasig City, and Quezon City.
New projects would include the company’s foray into economic housing under the brand Myplace, whose initial project will rise on a one hectare lot in front of the Danarra Hotel near the ABS-CBN compound. The pilot project will offer a total of 2,000 units with a size of 20 square meters each.
The other ongoing projects of SMDC are Chateau Elysee, a mid-rise condominium project in Parañaque City, which has completed five of its six clusters;Berkeley Residences in Katipunan Road, Quezon City, which is 63 percent complete; Grass Residences beside SM City North Edsa, which is 58 percent complete with its Tower 1; Sea Residences near the Mall of Asia Complex in Pasay City, which is 38 percent complete with Phase 1; and Field Residences in Sucat, Parañaque, which is 95 percent complete with its Tower 1. Both Mezza Residences, which is just across SM City Sta. Mesa and Lindenwood Residences, a residential subdivision in Muntinlupa City, are 100 percent complete.