LEADING mall and office builder SM Prime Holdings Inc. expressed bullishness toward the local office property market Friday, as it held a groundbreaking rite for another addition to its E-Com office development at the southern part of Metro Manila.
The giant developer is injecting over P4 billion into the project, calledb Four E-Com Center, which is mainly targeted at the burgeoning business process outsourcing (BPO) sector.
The Four E-Com Center is the fifth building under the SM Prime’s E-Com brand, all located within the SM Mall of Asia Complex in Pasay City. The new tri-tower development is set for completion in 2019.
Although there has not been pre-leasing yet for the project, the Four E-Com Center is projected to generate P700 million annual gross rental income for SM Prime.
“Strong interest remains due to more investors realizing the potential of the Philippines for their business,” said David Rafael, senior vice president for SM Prime’s Commercial Properties Group. “Our job is to provide them with good office space for their operations.”
Rafael said the new development is in response to the strong demand for office space, driven by the country’s economic growth and the robust BPO sector.
He said the BPO sector accounts for the lion’s share, or around 70 to 80 percent, of the demand for office space in the market.
Rafael emphasized that the development of Four E-com center shows the firm’s confidence in the office property market.
Construction for the Three E-Com Center has just begun, and Rafael said groundbreaking for another one—the Six E-Com Center—might take place either by yearend or early 2017.
“That tells you that we continue to be very bullish about the market,” Rafael said. “We continue to be very bullish about the [real estate]market, notwithstanding the current [financial]market volatility. We think this is temporary.”
The company official said SM Prime has not started pre-leasing units for the Four E-Com Center, as it focuses first on its Three E-Com Center, which is scheduled for completion in the second half of 2017.
Aside from the two E-Com buildings under construction, there are three other buildings under the E-Com brand—One E-Com, Two E-Com, and Five E-Com. All of these are fully leased out, according to Rafael.
The Four E-Com Center will add 123,968 square meters of gross floor area to SM Prime’s E-Com brand.
Rafael said the five E-Com office development projects cover 645,000 square meters of gross floor area.
The Four E-Com will have 16 floors, including a full basement, four podium parking areas, and 11 office levels.