ents and banking. The company was founded in 1958 by the late Henry Sy, who built it from a single Manila shoe store into the retail and property powerhouse it is today. The company is so big and geographically dispersed across the archipelago that it can style itself, not unrealistically, as a “proxy for the Philippine economy”. Like other retail and property giants in Southeast Asia that have long, rich histories and close ties to the government, it takes its responsibilities to ordinary Filipinos seriously, and not just those in the big cities. A key part of its strategic growth plan is to extend its services to underserved parts of the country, beyond the relatively affluent Metro Manila. This is in contrast with some other leading developers in the region, such as Siam Piwat and The Mall Group in Thailand, which have focused steadfastly on the big pickings in Bangkok despite the Thai government’s regional growth investments. 2025 was good, 2026 will be better SM recently announced that in 2025 it took in revenues of 681.7 billion pesos (US$11.4 billion), an increase of 4.1 per cent from the previous year. The retail portfolio did much of the heavy lifting to drive the company’s top-line performance: retail revenues totalled 318.1 billion pesos (US$5.3 billion), up 5.4 per cent. Meanwhile, revenues from the property portfolio amounted to 141.1 billion pesos (US$2.4 billion), up 0.5 per cent on 2024. Like Ayala Land, its largest peer, SM, under its SM Prime business, has particular expertise in developing extraordinarily large parcels of land, requiring partnerships with government and private entities, and in multiple property types: enclosed and open-air retail, residential, hotels, offices and convention centres. The Philippines, it must be remembered, was host to massive military facilities in valuable locations that were vacated and subsequently required redevelopment for civilian use. The last two of these were Clark Air Base and Subic Bay Naval Base, US facilities that were closed in 1991 and 1992, respectively. As a result, SM’s mixed-use developments are really cities in and of themselves, and indeed SM itself refers to them as “lifestyle cities”. A massive retail opportunity SM’s optimism about the future is well justified. An extraordinarily large chunk of the Philippine economy is consumer-driven, with about 70 per cent of GDP attributable to consumer spending. SM reckons that despite the high-quality supermarkets and malls, only about 30 per cent of spending on food happens in “modern retail” facilities. That kind of underpenetration represents a massive growth opportunity for modern supermarkets and other food chains. There is another important opportunity to be grasped as well. Like other countries in the region, notably Thailand and Vietnam, the Philippine government has a deliberate strategy of investing in the development of regional areas outside the main cities. This serves two purposes: the obvious one of generating growth and raising the standard of living in the provinces, and secondarily of relieving the pressure on the major metros – Manila in the Philippines, Bangkok in Thailand, Ho Chi Minh City in Vietnam – by creating alternative centres of commerce, education, health and so on. Almost 80 per cent of the Philippine government’s last budget and 85 per cent of its infrastructure spending were earmarked for regional areas outside Metro Manila. Accordingly, SM continues to emphasise its own commitment to the provinces, or you might say that it is “following the money”: 82 per cent of the 490 new retail stores opened in 2025 are located outside Metro Manila. It operates 126 supermarkets and hypermarkets under its own banner, and more than 30 retail brands with a store network of over 2,000. Its retail brands include global players like Uniqlo, Levi’s and Miniso. On the property side in 2025, it also opened two malls during the year, both in Luzon: SM City Laoag in the far north and SM City La Union on the central west coast. This brought the company’s mall portfolio to 89 in the Philippines and nine in China, in addition to 22 lifestyle cities that incorporate multiple uses. The Philippine malls house nearly 23,000 tenants and have a daily pedestrian count of 3.8 million. The company’s aim is to get 100 malls open by the end of 2028, with most of the new ones outside Metro Manila. To help achieve this, it has a landbank of more than 60 sites totalling 360ha. The economy is outperforming the region SM Prime is also confident about the economic backdrop for its operations. It points to consistent GDP growth of better than 5 per cent in the Philippines over the past decade (excluding the Covid year in 2020), well above the regional average and only bettered by Vietnam. Domestic consumption is bolstered by low household debt and remittances from the well over two million Filipinos working offshore. Also, significantly, in an era of frequently reckless government spending and big fiscal deficits, the Philippine government has exercised relatively sound fiscal management. Although it still runs a deficit, that deficit is not growing faster than GDP. Unfortunately, being an archipelago distant from the Southeast Asian mainland, the Philippines remains a bit off the beaten track and out of the news, which is a great pity because it has a lot to offer not only locals but also retail professionals from around the world. Further reading: Inside Central Retail’s new strategy to become Thailand’s market leader