Monday, October 5, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]
BY ALEXIS DOUGLAS B. ROMERO, Reporter
FOUR FIRMS have expressed interest in the Food Terminal Inc. (FTI) complex in Taguig which is scheduled to be auctioned off by the government this Thursday, officials said.
"There are four [firms who bought bid documents]. These are local firms," Guillermo N. Hernandez, head of the Privatization Management Office (PMO), said in an interview last week.
This was confirmed by Finance Undersecretary Crisanta S. Legaspi, who heads the department’s privatization group.
"So far, the pre-bid conference has been conducted by the PMO and it appears that there are about four parties who have indicated interest ... The next step is just the actual bidding itself," she said on Friday.
Officials did not identify the prospective bidders but Ms. Legaspi noted that companies such as Ayala Land. Inc. had previously expressed interest to submit offers. Other reports have said that the SM Group and San Miguel Properties, Inc. were also eyeing the property.
Company officials were not immediately available for comment.
Ms. Legaspi said the winning bidder would be required to deliver its cash payment within the year.
Property analysts polled by BusinessWorld said there was investor appetite for the FTI due to its size and location.
"Its proximity to the Bonifacio Global City and being accessible to SLEx (South Luzon Expressway), C5 and C6 [roads] make the property potentially viable," CB Richard Ellis Philippines, Inc. director Victor J. Asuncion said in an e-mail.
Ramon Jose E. Aguirre, research manager at Colliers International, said: "The FTI property is huge — this gives investors flexibility in the type of development they would like to pursue. The FTI property will be perfect for a mixed-use and master planned development that can take a decade to complete. The property is also in a strategic location."
Analysts also believe the timing of the sale to be appropriate.
"The best time sell property is just before November 30. Beyond that, money will be focused on the elections," Mr. Asuncion said.
Mr. Aguirre echoed the sentiment, declaring: "Perfect timing for the government. They are in need of more revenues for ballooning expenditures this year, and the market/investors are willing to answer."
FTI is a 120-hectare agro-industrial commercial estate in Taguig that is host to about 300 firms engaged in various lines of production and services. Only 103 hectares is up for sale since state grains agency National Food Authority already owns other portions of the property.
The property was supposed to be auctioned off last year but poor market conditions forced the government to defer it to this year. The sale is expected to generate P13 billion.
Asset sales totalling P30 billion are expected to help keep this year’s deficit within P250 billion.
Aside from the FTI property, other items scheduled to be bid out this year are a 40% stake in Philippine National Oil Co.-Exploration Corp. (PNOC-EC) and a 50-year lease for government property in Fujimi, Japan.
Initial estimates place the value of the PNOC-EC stake at P11 billion, while the Fujimi property in Tokyo is expected to add some P6 billion.
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