SM’s ‘Once upon a time in China’

Notes on the beat

MANILA, Philippines — In the early ’90s, Jet Li conquered the box office with the martial arts epic “Once Upon a Time in China.”

A decade later, the Sy family created its own “once upon a time,” debuting a project in China that would eventually become a major blockbuster as well.

While Li had kung fu, the Sy family had retail.

In 2001, the SM Group premiered in Xiamen and opened the large-scale shopping mall, SM Xiamen City, to mark its first step in China.

Twenty-five years since its foray, SM’s investments in China have grown and diversified to include a portfolio of nine malls, office towers and a hotel.

“Here of course is where our founder (Henry Sy Sr.) came from. It’s doing OK so far. On its own, it’s making money so we’ll leave it at that and see how we can grow,” SM Prime Holdings Inc. president Jeffrey Lim said.

After expanding its mall presence with the opening of SM City Xiamen Haicang – its ninth shopping center in China and its second mall in Xiamen – in November last year, and the opening of voco Xiamen SM City – its maiden hotel venture in China – in June, SM Prime continues to have a busy pipeline of projects in China in the coming years.

The company is expanding SM Xiamen City, its first development outside the Philippines, with a new commercial concept for Xiamen’s retail property market.

SM Prime is investing P1.5 billion to develop a 19,403 square-meter CHAO Block, which is envisioned as a “neo-urban block” that extends beyond the traditional mall model.

Developed with a diverse mix of tenants and partners, it will bring together independent founders, local entrepreneurs, cultural curators and first-to-market concepts in SM’s first mall in China.

Tenants will be encouraged to go beyond operating stores by hosting workshops, product launches, exhibitions, community events and brand collaborations.

“SM Xiamen City holds a distinct place in our company’s history. Being our first overseas investment, it has served as a long-term platform for learning, expansion and growth in China. As Xiamen continues to develop, we intend to keep strengthening the property and the local entrepreneurs so it remains an important part of the city’s commercial landscape,” Lim said.

The first phase of CHAO Block is slated to open in September 2026, while the second phase is targeted for completion in the fourth quarter of 2027.

Lim said SM Xiamen City remains as SM’s top performing mall in China. It now serves as a major shopping, dining and leisure destination in the city, hosting more than 500 stores, including international brands.

In 2009, the property expanded and added 109,922 square meters of gross floor area (GFA), repositioning it as an upscale lifestyle shopping center. In 2022, it added a further 129,195 square meters of GFA and refreshed its tenant mix to respond to younger consumers and growing demand for social and experiential spaces.

Lim admitted that SM Prime is indeed learning from China, noting that there is also so much opportunity for the Chinese concepts to be brought to the Philippines.

“There has been a lot of learnings from what China is doing. Before, we used to send our people to the US, and then even to Europe like London. But over the last five years now, instead of sending them there, we send them to China because there’s been a lot of advanced development in China, especially in the shopping center industry,” he said.

Looking ahead, SM’s “once upon a time” story in China that started 25 years will continue to grow, with Lim saying that expansion would likely be focused primarily in the Fujian province.

“Before it was more opportunistic. Every provincial government that goes to Manila before, so they invite us and then they will show us the properties and then we try to visit them and then if there is an opportunity we try to invest. But at the end of the day, China is so big that wherever you go, it’s like another country,” Lim said.

“So at the end of the day, we realized that the SM brand is actually very popular and quite known in the Fujian area because this is where our founder came from. That what made us decide that moving forward we will just focus on Fujian province,” he added.