MANILA Philippines "" Henry Sy Sr. chairman of the board for SM Prime Holdings Inc. and owner of the Agana Shopping Center is making a second attempt at bringing SM department store to Guam by opening at the Agana Shopping Center this November. The Journal first reported Sy’s intent in "It’s ShoeMart; Retail giant anchors Agana Shopping Center" story in the Oct. 18 2004 edition of the Journal.
SM is the largest retail chain in the Philippines with more than 25 branches and malls nationwide.
Jorge Mendiola senior vice president for SM Inc. expressed confidence that the department store will be able to compete head to head with retailers on Guam such as Macy’s Ross and DFS Galleria. "Because of our experience in the Philippines we believe we can offer the right assortment (of goods) to both locals and tourists."
He said the department store will offer "dry goods" to the shopping public and will not unduly compete with the retailers such as Payless in the shopping mall.
While he declined to give specifics about the goods that SM will be selling Mendiola said they will "source merchandise from both the Philippines and the (U.S.) mainland." SM will also be carrying Chamorro goods although he didn’t specify what these were.
The SM group was one of the early Filipino investors on Guam and operated its department store in the 1970s. "We had a store in Guam which we closed and planned to revive when we renovated the (Agana Shopping Center) mall " Mendiola said. He did not give any reason for the closure of SM Guam.
SM said it isn’t planning to expand to other Pacific or Micronesia countries but admitted to the possibility of another location on Guam. "For now we only wish to open in Guam since the SM group owns the Agana mall." Mendiola said "We will assess [the market] after we open. But of course [opening another department store)]is an option." Aside from the Agana Shopping Center on Guam the SM Group also owns the Aquarius Beach Tower in Saipan.
He said plans "are still being conceptualized" for the grand opening of SM Agana which will be the conglomerate’s fourth outlet outside of the Philippines the other three being malls in different parts of China.
SM just opened the Mall of Asia in Pasay City and is reputed to be the second largest in the world and largest in the Asia Pacific region at over 400 000 square meters of floor space sitting on 19 hectares of property. Located in a reclaimed area by the scenic Manila Bay along Roxas Boulevard the mall is home to more than 600 local and international brands and 150 dining establishments. It also houses the very first IMAX theater in the region with the screen measuring 22 x 30 meters "" approximately the size of an eight-story building "" and seating 600.
With its revenues generated mostly by lease rentals and space reservations mall operator SM Prime Holdings earned a profit of 1.34 billion pesos ($25.5 million) from January to March 2006 up 8% from the 1.24 billion pesos ($23.6 million) in the same period last year.
In a press statement it issued on May 8 the company said its income was buoyed by the 15% jump in gross revenues for the quarter in review to 2.85 billion pesos ($54.2 million) from 2.49 billion pesos ($47.34 million last year.
"[The growth in rental revenues] was largely due to rentals from new SM Supermalls opened in the second half of 2005 and 2006 namely SM City San Lazaro (Makati) SM Supercenter Valenzuela (Bulacan) SM Supercenter Molino (Cavite) and SM City Sta. Rosa (Laguna) " the company said. These malls currently have an average occupancy of 95%.
SM is targeting an 8% increase in profit this year to 5.4 billion pesos ($103 million) from 4.9 billion pesos ($93.2 million) in 2005.
The company is placing its bets on its newly-opened malls and "supercenters"""SM City Clark (Pampanga) Mall of Asia SM Supercenter Frontera Verde on C-5 Road Pasig City and SM City Lipa (Batangas). The company also plans on building SM Supermall in Bacolod City Negros Occidental in the Western Visayas region south of Manila.
SM Prime said it plans to build at least four to five malls annually for the next three years. The mall operator is a publicly-listed firm. MBJ