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SSS selling prime BGC lot

By Zinnia B. Dela Peña and Iris C. Gonzales (The Philippine Star) | Updated July 2, 2013 -
MANILA, Philippines - Amid mounting fears of overheating and asset bubbles, the state-run Social Security System (SSS) is recalibrating its strategy aimed at unlocking the full potential value of its real estate assets, starting with the sale of a prime property in the burgeoning central business district, Bonifacio Global City, for at least P2.24 billion.
In a briefing yesterday, SSS president and chief executive officer Emilio S. De Quiros Jr. said now is the “most opportune time” to unload one of its big-ticket properties when land prices are still moving strongly up.
“A robust Philippine economy has increased land values, providing a reason to sell at a higher premium. Land values are currently on the high side but nobody can predict where the market is headed. We feel at this point that now is the right time to sell our property considering what happened in the stock market in the previous week. Stock prices have gone up and down.  There is no way you can sell at the peak,” De Quiros said.
Up for sale is a portion of its land holdings in BGC with an area of 8,300 square meters for at least P269,894 per sqm or a total P2.24 billion. The property was acquired through a dacion en pago agreement with Bonifacio Land Corp. as the latter’s payment for its P1.5 billion debt.
The property, commonly known as Block 56, is located along Mckinley Parkway between 10th and 11th Avenues and near commercial areas such as Market! Market!, Bonifacio High Street, and the newly-opened SM Aura.
De Quiros said the property is expected to attract both domestic and foreign investors eager to capitalize on BGC’s robust commercial growth.
SSS chairman Juan Santos, for his part, said the state pension fund evaluated several options, including a lease and a joint venture, but the board determined that selling the property was the best course of action as the agency is not into real estate development.
“Given certain market assumptions, we opted for an outright sale since we are not experts in the property sector,” Santos said.
The pre-bid conference will be held on July 22 while submission of bids is scheduled on Sept. 4. The winning bid will be announced on Oct. 2.
“As the country positions itself to become Asia’s newest tiger economy, we at SSS want to unlock the value of our real estate properties to maximize earnings, spur economic growth, make higher yielding investments and help create new jobs,” De Quiros said.
De Quiros said SSS has P20 billion worth of real estate assets which include a four-hectare property located on East Avenue along EDSA, prime pieces of land in BGC, and a big lot near the Senate area.
Proceeds from the sale of the BGC lot will be used to further shore up its investment reserve fund.
De Quiros said the agency, which has trimmed its stock market exposure in the past six months, is considering aggressively investing in the stock market to take advantage of the current prices. “To generate income, we need to trade equities,” he said.
He said the fund is also looking at tapping the bond market next year.  Aside from this, it is also considering investing in overseas markets especially with the US economy showing signs of recovery.
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