Philippine malls ‘still landlord’s market’
Philippine mall rents are stable and it is still a landlord’s market, according to a market insight report for this year’s first quarter by Pinnacle Real Estate Consulting Services.
The report, Go, Grow and Glow, shows the blended average rent for mall space is estimated at PHP1200 (US$24) a square meter per month.
Meanwhile, top retail developers continue to expand, says the report’s author, Pinnacle Research director – research and consulting, Jojo Salas.
He says the SM Group has 60 malls in the Philippines (for a total of 7.7 million sqm) and seven in China (1.3 million sqm), while Robinsons Group has 42 malls. The Cosco/Puregold Group runs 329 stores nationwide comprising of 277 Puregold outlets (mixed sizes), 12 S&R membership shopping warehouses, 23 S&R New York Style QSR, nine NE Bodega Supermarkets and eight Budgetlane supermarkets.
“Smaller platforms like Robinsons Superstores, Savemore, SM Hypermarket, convenience stores and many more are mushrooming all over the place,” said Salas.
The SM group grew its operating income by 12 per cent to PHP35.3 billion last year, and its consolidated revenues by 12 per cent to PHP79.8 billion. “As expected, the recurring income of PHP23.8 billion last year continues to shine, which is the largest contributor to SM Group’s success.”
The group ended last year with 60 shopping malls, and this year intends to open at least four malls with an estimated combined 300,000 sqm of shopping space.
Pinnacle Research says Robinsons Land Group grew its net income last fiscal year by 7.9 per cent to PHP6.15 billion through higher revenues from malls and offices. Its total gross revenues amounted to PHP22.51 billion, up 14.2 per cent.
Robinsons Land’s commercial center unit accounted for PHP9.96 billion of its real-estate revenues, up 9.4 per cent. This followed the opening of malls in Cebu City, Tagum in Davao, General Trias in Cavite and Jaro in Iloilo.
“Like the SM Group, Robinsons malls are generating enviable recurring income every year,” says Salas.
While the Philippine economy continues to grow, the demand for commercial-retail has been underserved, he says.