By Jenniffer B. Austria | Jun. 30, 2015 at 11:01pm [ manilastandardtoday.com ]
A consortium led by property developers SM Prime Holdings Inc. and Ayala Land Inc. has won a contract to develop a 26-hectare reclaimed property in Cebu City.
SM-ALI Group consortium submitted a bid of P10 billion to develop the 26-hectare Lot No. 8-B1, the largest portion of the 45.2-hectare South Road Properties in Cebu. The group was the lone bidder for the lot, sources said.
Cebu City’s bid and awards committee said it awarded the project to the SM-ALI Group after they put a bid of P10.09 billion for the property which has a total area of 263,384 square meters or at the price of P38,015.98 per square meter.
The winning consortium immediately issued a managers check worth P1.186 billion as security bond to the city government, representing10 percent of the total bid.
This is the first collaboration between the country’s two largest property companies in Cebu. SM Prime said in a disclosure to the stock exchange it had formed a consortium with Ayala Land and its affiliate Cebu Holdings Inc. to bid for the project.
SM-ALI Group said the project was expected to benefit from the combined financial muscle, technical expertise and the real estate experience of two companies.
“With the resources and expertise of these real estate companies, this newest development at the SRP is planned as another showcase of integrated, master planned and sustainable developments that will bring in more investments and jobs for the local economy,” SM-ALI Group said in a statement.
The group will co-develop the property pursuant to a joint master plan.
The city government of Cebu on Tuesday conducted the bidding for two lots with a combined area of 45.2 hectares at the SRP for a floor price of P20,000 per square meter.
Other companies that earlier expressed interest in bidding for the SRP lots were Rockwell Land Corp., Filinvest Land Inc., Robinsons Land Corp. and Aboitizland Inc.
The 26-hectare lot won by SM-ALI is near the SM Seaside Mall being built by SM Prime while the other site is Lot 7 and Lot 17 with a consolidated area of 19.2 hectares. Bidding for the other lots was being conducted as this was being written.
Cebu City Vice Mayor Edgardo Labella described the outcome of the bidding as a “healthy exercise.”
“There is no substitute to a public bidding; open, fair and competitive and the city will dictate the price of the property… while in unsolicited proposal, it’s the buyer who will dictate the price.” Labella said.
SM Prime vice president for market research and planning Ronald Tumao said the group would follow the terms of reference of the bidding.
“We will be following the TOR..It will be a big boast to the development of the entire Cebu and not only the SRP.” Tumao said.
Tumao said the group would start the development in the area after six months based on the TOR.