BCDA to continue talks with CJHDevCo

The Bases Conversion Development Authority (BCDA) has deferred the decision on the settlement proposal by the Camp John Hay Development Corp. (CJHDevCo) of its unpaid lease rentals in the Camp John Hay Project.

According to lawyer Gina Alvarez, CJHDevCo chief counsel, inasmuch as legitimate issues relating to the effectivity of the July 14, 2000 MOA, as well as subsequent events and/or occurrences, were raised by CJHDevCo, BCDA agreed to enter into negotiations with CJHDevCo.

For the past two years, BCDA and CJHDevCo have been negotiating in good faith. At the moment, the issues relating to the settlement proposal have been narrowed down to the issue of valuation and the issue of interest computation.

"Communications between us are ongoing. As far as we know, the restructuring proposal is still in the works and only minor details need to be ironed out. Both parties expect an early resolution," Alvarez said.

Camp John Hay DevCo now operates the 189-unit Camp John Hay Manor, a golf clubhouse, a 3,000-seater convention center, not to mention various loghomes, countryhomes, and commercial establishments. CJHDevCo recently launched the construction of the Manor’s 287-unit companion hotel called the Camp John Hay Suites. Also ongoing is the construction of the entertainment center and the commercial center.

Meanwhile, BCDA president Rufo Colayco said that BCDA was cognizant of the economic difficulties of their leaseholders like Camp John Hay that finalized their contracts with government before the Asian financial crisis in 1997. Thus, BCDA is currently negotiating with CJHDevCo to settle unpaid rentals in the 247-hectare Baguio Leisure Estate. CJHDevCo wants the BCDA to honor a MOA signed by both parties in July 2000. In the MOA, the government admitted its shortcomings in the delivery of its obligations under the lease agreement.

To date, CJHDevCo has pumped in P2.5 billion with the construction of the loghomes, countryhomes, a 189-room Manor Hotel, the golf course and convention center. And it has earmarked P1.8 billion more in terms of development to materialize in one to two years bringing total commitments of up to P4.3 billion, exceeding the required investments under the lease agreement.

"Clearly, an early resolution of this matter will benefit the government in terms of revenues and it will give tourism a major boost. It will also send positive signals to foreign and local investors that government adheres to its privatization policy," Alvarez said.