Posted on 10:08 PM, March 10, 2010 [ BusinessWorld Online ]
CEBU CITY -- Landco Pacific Corp. and neophyte Cebu developer Genvi Development Corp. have terminated their joint venture agreement for the development of a P5-billion hillside residential resort here.
Genvi Development, controlled by the Villalon family which also owns the 210-hectare property that is being developed, will invest about P300 million in the project over the next 30 months. Part of this will be financed by loans from four banks that have signified interest to fund the project, said Genvi Development Managing Director Dindo Perez.
“We’re looking at May for the first tranche [of the loan],” Mr. Perez said shortly after Genvi Development President Augusto Villalon made the announcement yesterday afternoon.
Mr. Perez said Landco and Genvi Development signed the termination of the joint venture agreement on Feb. 12, about three months since the two companies started negotiations. A notice on the termination of the agreement has been filed with the Housing and Land Use Regulatory Board.
Mr. Perez said “it was an amicable termination” and Landco was compensated for the development costs it had incurred since the project was launched in December 2006. He declined to specify the amount.
The project, dubbed Monterrazas de Cebu, would have been Landco’s first in the Visayas. The project has encountered several delays because of drainage problems and changes in Landco’s ownership.
Then parent firm Metro Pacific Investments Corp. last year reduced its stake in Landco to 34% and sold a portion of its shares to AB Holdings Corp. of Landco President Alfred Xerez-Burgos, Jr. No Landco representative was present during the announcement yesterday.
Marga Villalon, Genvi Development vice-president and treasurer, said her firm was excited to take over the project, intent on raising the bar for property development in Cebu.
“We are laying our company on the line here by saying we are capable of doing it. Ultimately, this is a Cebuano project,” she said.
Mr. Villalon, for his part, said his group would make up for lost time and stick to the original development timetable. Horizontal development of the first phase, which consists of two clusters of lots with a total size of about 74 hectares, is ongoing and will be completed in three years.
“But by the end of this year, some lot owners can already start the construction of their houses,” he said. An architect himself, Mr. Villalon designed the entrance complex to the project as well as a pavilion.
The entire 210-hectare property, which spreads over eight hills in five barangays in the middle of Cebu City, will be developed into 10 clusters of lots by phases over the next 10 to 15 years.
A five-hectare block has been designated for condominium buildings.
Other planned developments are townhouses, commercial and lifestyle areas, and cluster enclaves for families and friends that would like their own private compounds. -- Marites S. Villamor