SMDC sets aside P4.5B for ongoing, new projects

SM Development Corp. (SMDC), a real estate company owned by the SM Group of retail tycoon Henry Sy, is setting aside P4.5 billion for the developmenmt of ongoing and new projects and for landbanking activities to take advantage of the continued strong demand for middle-income residential units.

SMDC president Rogelio Cabuñag said this year’s programmed capital budget is 50 percent higher than the P3 billion spent in 2006.

At the same time, SMDC announced that its net income reached P14 million in the first quarter this year, down 98 percent from the previous level due to unrealized mark-to-market losses.

To ensure continued growth, SMDC continues to be on the lookout for properties in strategic locations or those close to SM shopping malls for future development.

SMDC reported a 125-percent  increase in its real estate sales during the first three months of this year to P575 million,  compared to P256 million during the same period last year.

This resulted to a 173-percent increase in  gross profit from real estate operations to P240 million.

EBITDA (earnings before interest, taxes, depreciation and amortization) reached P104 million, for an EBITDA margin of 62 percent. 

SMDC still holds substantial marketable securities in its portfolio as part of its asset management  operations. These will be liquidated to support future operations, Cabuñag said.

“We are pleased with SMDC’s initial results for the  year. We have started on the right track, as evidenced by the doubling of our sales revenues  during the first three months of 2008. The encouraging sales performance of the company  indicates the market’s continued acceptance of our projects, which drives us to further improve  our product and service delivery throughout the rest of the year and beyond,” he said.

To date, SMDC has five ongoing projects, namely Chateau Elysee in Parañaque City;  Lindenwood Residences in Muntinlupa; and the Mezza, Berkeley, and Grass Residences, all  three of which are in Quezon City. Except for Lindenwood Residences, which is a residential  subdivision, all are residential condominium projects.

For 2008, SMDC intends to launch two to three more projects. One would be the Sea Residences  within the Mall of Asia Complex in Pasay City; the other is the Field Residences in Sucat,  Parañaque City, and possibly a third, which is the Wind Residences in Tagaytay City.