SM Prime Holdings Inc., one of the largest integrated real estate companies in Southeast Asia, is planning a $1-billion real estate investment trust offering to help fund its massive P136 billion capital expenditures for 2023. During the firm’s annual stockholders’ meeting, SM Prime President Jeffrey Lim said they are looking at the second half of the year to undertake the maiden public offering of the REIT with the intent of infusing an initial 12 to 15 shopping centers (out of 82 malls) worth $3.5 billion to $4 billion. “So it's purely initially shopping centers. We actually have the portfolio details already, but we're still doing some evaluation with bankers. And I think the key really is the timing. Because you know, interest rates are still very volatile. So we want to make sure that when we launch something that it is sustainable, and that we can deliver our commitments,” he added. Lim said it will initially be a mix of mature large and smaller malls and, after the IPO, they will infuse another batch of assets into the REIT, possibly including office buildings, to raise more funds for future development expenses. SM Prime Chief Finance Officer John Nai Peng Ong said proceeds of the REIT IPO will be used primarily for the firm’s reclamation of land in Pasay near SM Prime’s Mall of Asia complex. The entire project will reclaim 360 hectares at a cost of about $2 billion for the horizontal development alone which will include utilities and roads. “I don't think we will be spending the entire $2 billion in one year. So whatever we raised now from the REITs, we can use it up to probably end or middle of next year. And then the REITs should also roll. So we may inject additional assets in the future and then raise additional funds to fund the requirements,” Lim said. Aside from the $1 billion for the reclamation project, Ngo said the firm is allotting P80 billion for capital expenditures this year, mainly for the development of new and existing malls as well as residential projects. SM Prime is scheduled to open three new malls and expands certain malls in the Philippines this year, which will provide an additional 200,000 square meters of gross floor area. These new shopping malls will be in Bataan, San Pedro in Laguna and Sto. Tomas in Batangas. Ngo said that, about 10 percent of the P80 billion capex will be used for leisure developments, office buildings, and convention centers. For its residential business segment, SM Prime aims to launch 15,000 to 20,000 residential units, subject to government approval of licenses to sell. Likewise, this year, SM Prime is set to launch Lanson Place Hotel and Serviced Suites in Mall of Asia Complex in Pasay City.