Manila's San Miguel, state fund in property JV

MANILA, April 13 (Reuters) - San Miguel's (SMCB.PS: Quote, Profile, Research, Stock Buzz) new property unit has agreed a joint venture with the Philippines' state pension fund to develop a 1.7 billion pesos ($41 million) hotel in Manila, the first major property deal for the food and drinks group.

"We expect the dividend payments from this hotel to further bolster our actuarial life," Winston Garcia, the head of the fund, GSIS, said on Sunday. "It will have world-class facilities and will cater primarily to high-end tourists and businessmen."

Manila-headquartered San Miguel wants to remould itself as a conglomerate with interests in property, power and mining as well as food and drink amid rising input costs for consumer companies and a sluggish home market.

Earlier this week it kickstarted the local roadshow for its $400 million plus IPO for its domestic beer group.

Garcia said the new project, in which San Miguel Properties and GSIS will have equal ownership and division of profits, would be a service apartment-type hotel.

GSIS will provide the land in Manila's financial district and San Miguel Properties will provide the initial funding for the construction and development.

Construction is expected to start soon and the hotel is scheduled to be open by January 2011. (Reporting by Carmel Crimmins; editing by Louise Heavens)