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Ayala Land firming up proposal for Pasay reclamation project

Posted on October 30, 2013 10:19:03 PM [ BusinessWorld Online ]

PROPERTY DEVELOPER Ayala Land, Inc. is preparing its counter proposal to SM Group’s P54.5-billion reclamation plan in Pasay City, the listed firm said in a statement yesterday, adding that it has been in talks with a foreign company on the venture.

“We have spoken to a leading international engineering company with vast experience in reclamation all over the world, and they said that it will take a minimum of two months to come up with a well thought-out development plan,” Bernard Vincent O. Dy, Ayala Land executive vice-president, said in the statement.

Ayala Land last week wrote Pasay City Mayor Antonio G. Calixto that it was keen on challenging SM Land, Inc.’s unsolicited proposal for a joint venture with the city government “to undertake the raw land reclamation and horizontal development of 300 hectares.”

Ayala Land asked for additional 60 days from the Nov. 4 deadline set for submission of competing proposals, as well as for the city government to reduce the P5 million bid document fee.

In its own proposal, SM Land said it would complete the project within seven years from issuance of the notice to proceed. SM Land will also reserve 153 hectares or 51% of the area to the Pasay City government or the Philippine Reclamation Authority.

The Pasay City public-private partnership office, in a notice published early this month, said interested entities should have undertaken a similar reclamation project with an area measuring at least 120 hectares, “preferably within the Manila Bay area,” and should have a minimum capital of P50 billion.

Officials of the city government were not immediately available for updates on Ayala Land’s requests.

Mr. Dy said reclamation project will give Ayala Land a presence in the Manila Bay area, where 60-hectare SM Mall of Asia Complex is located.

“This project is important to the company as it presents an opportunity for us to have significant presence in the Manila Bay area, contribute to the growth and progress of the city of Pasay, and make the reclaimed area the country’s model of urban and sustainable development,” Mr. Dy said.

SM Group, in a brief statement yesterday, said: “If SM will be developing [the area], it will work together with Pasay City to implement what will be good for Pasay and its community.”

Ayala Land ended the first half with a net income of P6.62 billion, up 23.28% from P5.37 billion a year ago.

This as revenues rose 35.67% to P36.63 billion from P27.0 billion, while cost and expenses increased by 39.00% to P27.51 billion from P19.79 billion.

SM Land, meanwhile, is a privately held company of the Sy family that early this month merged with SM Prime Holdings, Inc. as part of a consolidation effort that will leave the listed mall developer as surviving entity.

Shares of Ayala Land climbed P1 or 3.45% to close P30.00 apiece yesterday from P29.00 on Tuesday, while those of SM Prime rose 18 centavos or 0.97% to P18.68 each from P18.50. -- C. H. C. Venzon

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