Vol. XXI, No. 165 [ Business World Online ]
Tuesday, March 25, 2008 | MANILA, PHILIPPINES
CEBU CITY — Filinvest Land, Inc. has offered to purchase a portion of the 300-hectare South Road Properties and form a joint venture with the Cebu city government for the development of another lot.
The Cebu city government favors Filinvest Land’s proposal, but will still hold a bidding in compliance with state audit rules, said Cebu Investment Promotions Center Managing Director Joel Mari S. Yu. The city government is also consulting its lawyers on how to accommodate Filinvest’s proposal and ensure that the bidding process will be aboveboard.
Aside from Filinvest, two more listed property developers are expected to submit their proposals soon for other portions of the South Road Properties, Mr. Yu said. The Cebu Investment Promotions Center, the exclusive marketing arm of the city government for the South Road Properties, has been in talks with Filinvest and the two other companies since last year for the development of separate portions of the reclaimed property.
"We want to hold the bidding as soon as possible. If we can do it tomorrow, we will. But we’re still consulting with CoA (Commission on Audit), our lawyers and other consultants to make sure that everything is right the first time. The two other companies said they will submit their proposals after the Holy Week, so it should be any day now," Mr. Yu said.
The Filinvest proposal is divided into two contractual arrangements, which are "dependent on each other," Mr. Yu said.
One is the outright purchase for about P2 billion of a 13-hectare lot, part of the 15-hectare Pond F, which is considered the most valuable piece of property in the reclaimed area at P15,000 per square meter because it is located on the seafront.
"The city government wants to retain two hectares of Pond F for utility purposes. When development starts at [the South Road Properties], contractors will need to barge in their aggregates so we need an area where we can build a wharf for this," Mr. Yu said.
The second component entails the development of a 35-hectare lot across Pond F into a mixed-use commercial center that will include recreational facilities, residential condominium buildings and IT (information technology) buildings. This is proposed to be developed under a joint venture.
"The city government will provide the land. Filinvest will develop and market the facilities and the city government will get a portion of the revenues," Mr. Yu said.
Tristan Las Marias, Filinvest vice-president for the Visayas and Mindanao, had submitted the proposal but was not available for comment yesterday.
Meanwhile, Mr. Yu said his group had sat down at least three times with the two other developers interested in developing portions of the South Road Properties to refine their respective proposals.
"We want to make sure that the proposed projects would be fair and equitable to both the city government and the proponent," he said.
The South Road Properties is a 300-hectare greenfield development reclaimed by the Cebu City government with the assistance of the Japan Bank for International Cooperation (JBIC), which extended a ¥12-billion loan through the Land Bank of the Philippines.
A special patent was issued in September 2005 to the Cebu City government. This has been broken down into 12 land titles to facilitate sale or lease agreements with interested parties.
The area is registered as a special economic zone with the Philippine Economic Zone Authority and was designed for mixed land use that can accommodate manufacturing, commercial, tourism, information technology, and other service enterprises. — Marites S. Villamor
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