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SM Aura not yet off the hook – BCDA

Published on 23 May 2013 [ ]
THE controversial SM Aura Premier mall is not yet off the hook because it allegedly interpreted the Deed of Conveyance (DOC) according to their own benefit, the Bases Conversion and Development Authority (BCDA) declared on Thursday.
At the same time, BCDA refuted the claim of SM Prime Holdings Inc. that the mall was built legally based on a DOC between the BCDA and the city government of Taguig.
For its part, SM Prime also on Thursday cried foul over allegations that the construction of SM Aura Premiere is illegal.
The state-run agency asserted that the DOC is in accordance with Republic Act (R.A.) 7917, which requires that the land where SM Aura currently stands be used for a civic center.
BCDA claims that it originally donated the land to Taguig City under then-Mayor Freddie Tinga to be developed into the Taguig Civic Center.
Taguig City hosts the Bonifacio Global City (BGC) where SM Aura Premiere is located.
But instead, the local government leased the land to SM Prime, which used it to host a lavish upscale mall.
BCDA President and CEO Arnel Paciano Casanova explained that the stipulations of the Deed of Conveyance were drafted and agreed upon in accordance with R.A. 7917.
He said that Section 1 of that republic act provides that “approximately 40 hectares of land in Fort Bonifacio shall be retained as national and local government centers, sports facilitiess and parks.”
“As long as they use the land either for national or local government centers, sports facilities or parks, we will not place restrictions. But what they did was use the land for a mall, which is a clear violation of the law,” he added.
The Office of the Government Corporate Counsel (OGCC) had the same interpretation of the concerned Deed of Conveyance.

Casanova added that the BCDA is not the one that would have gained from the land in question, nor is it the one losing out on the land’s misuse.

“The people of Taguig have been robbed of a community center. What good can this ultra high-end mall do for them, if they have been deprived of a place that provides basic care and services?” he asked.
“Furthermore, the men and women of our armed forces, instead of benefiting from remittances from the land being put up for bidding, are losing out on modernization funds because the land was turned into a mall,” Casanova added.
The land occupied by SM Aura is valued at approximately P5 billion.
Casanova also lashed back at critics who said that the BCDA acted too late in questioning the establishment of SM Aura Premiere.
He pointed out that as early as 2009, the Bonifacio Estate Services Corp. (BESC), which is in charge of BGC’s upkeep, rejected SM Prime’s outline application for the proposed community and retail complex, because the development is not in line with what is being stipulated by law.
While a BESC permit is necessary to engage in construction activities in BGC, SM Prime was able to commence building by getting a permit from the Taguig City Hall.
Casanova added that SM Prime avoided declaring the official purpose of the development, and this loophole allowed them to continue with the building.
But on May 7, the BCDA received an official letter confirming that the development was indeed classified as a mall.
“This proved without a doubt that SM is in violation of the law,” Casanova said.
SM Prime cries foul
For its part, SM Prime belied the accusations of BCDA.
Cora Guidote, senior vice president for Investor Relations of SM Prime, said that the construction of SM Aura Premiere underwent the proper legal processes.
If the BCDA has questions on SM Aura’s construction, Guidote said that the agency should ask the city government of Taguig for an explanation.
“The city of Taguig started the project by opening it into bidding, we won it and so the project was awarded to SM Prime,” Guidote told The Manila Times.
She also maintained that the project is legal, saying that the facility is not totally and solely intended for a mall but it will be a state-of-the-art civic center.
“The mall is just a podium or it will be just 30 percent of the entire facility, because we are still going to build a church, convention and recreation facilities,” she added.
Guidote stressed that SM Prime just introduced a modern concept of a civic facility, since it wanted to uplift the delivery of services to the public.
“It’s a modern concept, we try to elevate the community by giving them a state-of-the-art civic center,” she added.

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