SM Prime Holdings Inc. plans to maintain its capital spending at around P60 billion to P80 billion in 2027, with President Jeffrey Lim saying the company could spend as much as P100 billion depending on investment priorities and market conditions.
However, the Sy family-led property developer said it would be more selective in pursuing new developments amid softer residential demand and changing market conditions.
“We remain confident in the long-term prospects of our portfolio. And we will continue to invest across all businesses,” Lim said.
“However, we will be more selective about which project to prioritize and when to proceed with them,” he added.
The company said it would prioritize completing ongoing developments and redevelopments, while adjusting the timing of some projects in its pipeline.
Lim said hotel and convention center developments would proceed as planned, citing opportunities in tourism, meetings and conventions.
For residential projects, however, the company is taking a more measured approach to new launches, with demand proving relatively stronger in the premium segment.
“We'll be more cautious about launching projects in the core segment until buyer take-up and sentiments improve,” Lim said.
SM Prime said it had no plans to launch new office projects for now, opting instead to complete developments already underway and improve occupancy across its existing portfolio.
The spending strategy comes as the company's residential business continued to weigh on its financial performance.
SM Prime reported consolidated net income of P35.4 billion in the first nine months of 2026, down 5 percent from P37.2 billion a year earlier, as real estate sales declined 23 percent to P24 billion.
Consolidated revenues were nearly flat at P103.1 billion from P103.4 billion. Rental income increased 8 percent to P66 billion, while other revenues, including leisure, entertainment, hotel dining and advertising, rose 17 percent to P13.1 billion.
Revenues in the residential segment fell 21 percent to P25.6 billion, reflecting slower revenue recognition and buyer backouts.
“Higher borrowing costs, elevated inflation and cautious consumer spending continued to weigh on residential demand. However, growth in our commercial and hospitality businesses helped keep revenues steady,” Lim was quoted as saying in the company's earnings statement.
Capital expenditures reached P44.4 billion in the first nine months, down 25 percent from P59.3 billion a year earlier. Spending went mainly toward ongoing mall and residential developments alongside commercial, integrated, hotel and convention center projects.
Lim said the company was not putting its expansion plans on hold but would focus on investments with stronger demand and retain flexibility as market conditions evolve.
“We are simply being more deliberate about how we spend, and we will focus on projects with stronger demand while keeping the flexibility to adjust our plans as market conditions evolve,” he said.
SM Prime shares on Monday slipped P0.64, or 3.60 percent, to close at P17.16 each.
