SSS worried over delay in P8-B project

The Social Security System (SSS) has expressed concern that further delays in the approval of its proposed P8-billion Corporate Center Project could drive costs higher or dishearten the investor.

EC Harris, co-investor of the SSS in the four-hectare multi-purpose center to rise along East Ave. and EDSA fronting the GMA Channel 7 Complex, has likewise expressed concern over the unstable political climate in the country which may affect investment.

The unsolicited build-operate-transfer (BOT) proposal will have EC Harris investing roughly P8 billion for the project while the SSS will contribute the four-hectare property as its equity share.

However, the Department of Justice (DOJ) wants to first review the contract which EC Harris and the SSS drafted. The draft contract must be submitted to the (Investment Coordinating Council) ICC-NEDA for final approval or second pass.

And since it is an unsolicited BOT proposal, it must undergo the so-called Swiss challenge wherein the public will be invited to submit bids for the project. After the bids are submitted, the project proponents (EC Harris and SSS) can match the offer of the highest bidder.

SSS special assistant to the president Lucito L. Sioson, however, revealed that submitting the draft proposal to the Justice Department prior to that of the ICC-NEDA may cause further delays.

"They (NEDA) want us to submit it this month (August) but we are still seeking an extension, or at least allow us to submit the draft contract simultaneously to both agencies," Sioson added.

When the proposal was submitted to the NEDA for first pass two years ago, the peso was valued at 52 to the dollar.

Since then, the peso has weakened to a little over 56 to the dollar.

Likewise, the increasing cost in construction materials, oil prices and the continued inflationary conditions in the past two years may likely increase by several fold the actual project cost.

"The costs will definitely increase tremendously," the SSS official said.

After it got first approval from NEDA, the project got stuck with the Quezon City Council, as the area where the project would be launched must be reclassified into a mixed-used commercial and residential area. But before the end of the first semester of 2005, it finally got the nod of the city council.

When approved, it will be a 25-year build-operate-transfer (BOT) project that would result in a twin tower structure for mixed purposes including residential, commercial, shopping, and parking.

Owned by the state pension fund, the SSS will eventually move its headquarters in the center.