SM PRIME Holdings, Inc. is looking to defer the market listing of its real estate investment trust (REIT) to next year due to market conditions, an official of its parent firm SM Investments Corp. (SMIC) said on Wednesday.
“They have always said that [the REIT] is subject to market conditions. As we are looking at things now… we may look to potentially do this a bit later than had initially been said,” said Timothy Daniel, SMIC head of investor relations, sustainability, and communications, said during the PSE STAR event.
“[In] the second half of this year, they will assess market conditions, and this is maybe something for next year,” he added.
Mr. Daniels cited market headwinds like higher interest rates, inflation, and market sentiments.
Earlier this year, SM Prime said that it was targeting to launch its REIT portfolio by the second half of the year.
The company’s planned REIT offering is likely to be valued at around $3.5 billion to $4 billion and initially composed of 12 to 15 assets, which will come from the 82 malls it currently has as 30 to 35 malls are now fully matured.
“Perhaps they would list about a quarter of that, bringing in about $1 billion of revenue, particularly towards funding the reclamation efforts in Manila Bay,” Mr. Daniels said.
Additionally, he said SM has fully stopped its reclamation operations after the government halted all Manila Bay reclamation projects.
“We have been working on this reclamation project for over a decade, during that time one of the real priorities has been to make sure that all of the documentation required is in place,” Mr. Daniels said.
“Right now, under the government’s requirements, we have stopped all of the work — for now, and we are listening to what else [they] want,” he added.
He said the company would announce its plans regarding the reclamation project once the government has completed its review.
SMIC through SM Prime is developing a 360-hectare reclamation project in Pasay City directly connected to the Mall of Asia Complex worth around P100 billion.
The government announced earlier that it had suspended all reclamation projects ahead of a review by the Department of Environment and Natural Resources.
SM Prime shares rose by 1% or 30 centavos to P30.40 apiece, while SMIC shares went up by 3.02% or P26 to P886 per share on Wednesday. — Adrian H. Halili