BCDA, Camp John Hay DevCo in talks for third restructuring of P2.1-billion back rentals

The Bases Conversion Development Authority (BCDA) and the Camp John Hay Development Corp. (CJHDevCo) are back at the negotiating table for a possible third restructuring of the over P2.1 billion back rental of CJHDevCo for Camp John Hay.

According to BCDA president and chief executive officer Narciso Abaya Jr., CJHDevCo had stopped its rental payments for the Baguio property in December 2003 after the Supreme Court ruled that CJHDevCo was not entitled to incentives. submitted yesterday an improved rental restructuring offer.

The BCDA and CJHDevCo had reached a second debt restructuring agreement March 2003 and CJHDevCo was able to make a payment in July 2003.

However, following the SC decision in October 2003, CJHDevCo stopped rental payments anew to BCDA.

CJHDevCo had first sought a debt restructuring of its rental/lease payments to BCDA in 1999 with the original amount involved of P425 million.

However, by 2002, CJHDevCo had started defaulting on its payments until the back rental involved ballooned to P1.1 billion.

The second restructuring in March 2003 covered the P1.1 billion back rental.

Abaya said that BCDA and CJHDevCo are still in initial talks over the unpaid rental especially since it is now complicated by the removal of CJHDevCo’s incentives.

The second debt restructuring agreement involved a cash payment, a "dacion en pago" of already completed cottages, and additional cash securitized by cottages still under construction.

CJHDevCo chairman Robert John Sobrepena, during the signing of the second debt restructuring, had said that the deal covers the payment of 70 percent of the total outstanding amount over a period of 12 months.

The CJHDevCo paid the BCDA P50 million upon the signing of the agreement.

An additional sum was supposed to have been paid by CJHDevCo once the restructuring agreement was approved by the Office of the President, Sobrepena said.

Additional cottages, Sobrepena added, would also be used to pay for the remaining 30 percent of the amount to be restructured. v