STATE-RUN Government Service for Insurance System (GSIS) will lease its three-hectare property in Quezon City to Sy-led SM Prime Holdings, Inc., the country’s largest shopping mall developer and operator, for 25 years.
In a statement, the state pension fund for government workers said it would earn P1.3 billion from the lease agreement covering the property where the GSIS Quezon City satellite office is located.
'Three interested parties made an offer for the development of the property, with the SM Group coming up with the best offer after a thorough evaluation process. The GSIS board of trustees then authorized the GSIS management last Feb. 6 to negotiate with the SM Group for a long-term lease of the property,' it added.
SM Prime will develop the property into a commercial complex. For the duration of the construction period, the GSIS QC Satellite Office will still be open for business. The satellite office will later be housed in the new SM commercial complex.
The GSIS sought offers for the development of the GSIS QC property in 2006. However, a senior official from the listed firm told BusinessWorld no agreement has been signed yet.
But he confirmed the listed mall operator is in talks with GSIS. 'We confirm we are discussing it with them,' he said.
Business World tried to reach officials of GSIS but they were not available as of press time. Yesterday, SM Prime shares closed 2.41% higher at P8.50.
SM Prime has 30 malls nationwide, with a total gross floor area of 3.9 million square meters.
In 2007, it opened SM City Bacolod, SM City Taytay, and SM Supercenter Muntinlupa. Expansion of existing malls — SM City Cebu Annex, The Science Discovery Center in the Mall of Asia in Pasay, SM City Pampanga, and the San Miguel by the Bay at the Mall of Asia Complex were also completed.
This year, the company is scheduled to open SM City Marikina, SM City Baliuag, and SM Supercenter Rosales.
Expansion of SM Megamall in Ortigas and SM City Fairview are also underway.
The total gross floor area will increase to 4.1 million square meters by end-2008.
In November, the SM Prime board approved the acquisition of the three SM malls in China that are privately held by the Sy family.
The malls are in Xiamen, Jinjiang and Chengdu.