Government favors lease over sale for FTI

MANILA, Philippines -  The Aquino administration is looking at leasing out the Food Terminal Inc. property in Taguig instead of an outright sale, Finance Secretary Cesar Purisima said over the weekend.

“We may lease out or sell the FTI property but the preference of President Aquino is leasing it out,” Purisima said.

He said a long-term lease would allow the government to keep the property instead of an outright sale.

He also said that at least three big-ticket developers are vying for the property but noted that one group which has been actively negotiating with the previous administration will have the first crack.

The privatization council in-charge of the long-planned sale of the 103-hectare property has yet to secure an approval from Malacañang, Purisima said.

Sources privy to the matter said Andrew Tan-led Empire East Land Holdings Inc., Gokongwei-led Robinsons Land Corp. and the Ayala Group have all expressed interest in the property.

Empire East, a subsidiary of Megaworld Corp., last week submitted an offer to the finance department to acquire FTI for P14 billion.

Similarly, Robinsons confirmed in a disclosure last month that it also submitted a bid to the Finance department for the FTI property.

During the Arroyo administration, these giant developers expressed interest in FTI but none formally submitted bids during the public auction. Robinsons Land and other local firms, including Ayala Land Incorporated expressed interest but no bidding pushed through in 2009.

The FTI property up for privatization covers 103 of the 120-hectare property in Taguig. The remaining 17 hectares belong to the National Food Authority.

Finance Undersecretary for Privatization John Philip Sevilla earlier said the minimum bid is P13 billion, higher than the P7 billion to P9 billion, previously set by the Arroyo administration.

Initially, the Arroyo administration sought at least P16 billion from the FTI sale proceeds but the global financial crisis affected real estate prices.

FTI was originally built to be a food processing and consolidation center for agricultural products. The terminal houses more than 300 small-to-medium scale companies engaged in manufacturing, garments and electronics.