In the span of 30 years, SM Prime Holdings (PSE: SMPH) has become a dominant force in the Philippine real estate sector, driven by the iconic SM malls and market-leading developments of SM Development Corp. (SMDC).
It traces its origins back to a small shoe store founded by Henry Sy, Sr. in the city of Manila, SMPH has grown into one of the most valuable firms in the country and the leading integrated property developer in Southeast Asia.
Beyond its impressive scale, SM Prime represents the bellwether of the Philippines—its progress follows the same course as the country’s economic and social development.
Turning Headwinds into Headway
In the 1990s, the Philippines posted a real GDP growth rate of 2.8% per year, due to political instability, natural disasters and the Asian Financial Crisis.
At the time, the average loan interest rate was over 19%, reflecting the broader economic challenges the country was facing.
Against this background, SM Group established and listed SMPH in July 1994 to organize and expand its shopping mall chain. At that time, it had only four in its portfolio: SM North EDSA, SM City Sta. Mesa, SM Megamall and SM City Cebu.
After raising nearly P6 billion in the stock market, SM Prime expanded its network of malls, cemented its position as the largest mall operator in the country and earned a place in the Philippine Stock Exchange Index (PSEi) since October 1994.
Restructuring Growth
Entering its second decade as a listed company, SM Prime led a dynamic merger that changed the course of its growth.
Through a series of successful transactions, SM Group consolidated its full real estate interests under SM Prime, successfully transforming a shopping mall operator into a real estate conglomerate.
The entire process, from announcement to final regulatory approval, took less than five months. Its speed and creativity earned it the SM Prime “Most Innovative Deal” award in the financial publication. Alpha Southeast Asia.
After the merger, SMPH’s market capitalization increased 133% to P950 billion by the end of 2023, from about P408 billion in 2013.
Setting Records
Since its restructuring, SM Prime has been pushing the boundaries in value generation.
In 2017, the local titan made history as the first company on the PSE to reach a market capitalization of P1 trillion, closing at P1.01 trillion on June 9.
SM Prime also surpassed a milestone in revenue recognition, surpassing the P104 billion mark in 2018 and recording P128 billion in 2023, the highest to date.
Over the past 10 years, annual revenue has grown 146% from P16 billion to a record high of P40 billion by 2023, the highest among its listed peers.
The company is poised to break another profit record in 2024, with first-half earnings rising 13% to P22 billion, from P19 billion last year.
Beyond Profit
SM Prime’s growth transcends financial metrics and shareholder returns. It has been a catalyst for national progress—creating jobs, contributing to tax revenue, building communities and improving urban sustainability across the Philippines.
“As SM Prime celebrates its 30th anniversary, we are focusing on innovation and sustainability. With the strong foundation we have built, we believe our best projects are yet to come,” said SM CEO Jeffrey Lim.
We have integrated project development in our five-year roadmap, which we expect will propel the company to a new level of growth,” he added.
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