BOPK dads authorize Rama to sell SRP lots

CEBU, Philippines - At least 11 Cebu City Councilors including allies of the Bando Osmeña-Pundok Kauswagan have agreed to give Mayor Michael Rama the authority “to negotiate and dispose by sale” 45.2 hectares of land at the South Road Properties to interested investors.

They are Councilors Gerardo Carillo, Noel Eleuterio Wenceslao, Nestor Archival Sr., Roberto Cabarrubias, Eugenio Gabuya Jr. and Richard Osmeña, who are members of BOPK. While those allied with Team Rama are Councilors Nendell Hanz Abella, James Cuenco, David Tumulak, Mary Ann Delos Santos and Ex-officio member Philip Zafra.

 The disposal of SRP lots need the approval of  the City Council as provided for under City Ordinance 2332. The ordinance reportedly hinders Rama “to openly entertain” investors and developers to purchase parcels of land at the SRP without prior approval from the City Council.

 As stated in Section 3 of the ordinance, no person, including the mayor, is allowed to “sell, dispose, transfer or convey property in SRP; advertise or publish for sale; invite for public bidding, negotiated sale or other mode of sale, disposal; and transact in any manner.”

 In the joint draft resolution signed by the 11 councilors, Rama is given the authority for and on behalf of the city to negotiate and dispose by sale through public bidding Lot No. 8 (located near the Calungsod template) containing a total land area of 26 hectares; and consolidated lots No. 7 and No. 17 (located beside SM Seaside) consisting of 19.2 hectares, to any interested and qualified investors and developers.

 The draft resolution is expected to be discussed on Wednesday during the council’s regular session.

 City Attorney Jerone Castillo is confident that the measure will be passed considering that majority of the members have already signed it.

“This will be taken up to the council, but from the looks of it nga naa nay ‘number’ this sets everything in motion so wala na ta’y problema,” Castillo said.

Lawyer Mary Rose Salvatierra, who drafted the resolution, said the city is expected to generate a conservative amount of P12 billion out of the property is sold at P20,000 per square meter.

 Castillo added that the projected revenue is on top of the P2.5 billion to be generated from the real property taxes excluding the collections from business taxes and regulatory fees.

Castillo said the projected funds will be used to pay the city’s outstanding obligation of P3.2 billion with the Japan International Cooperation Agency.

 It will also help fund the construction and rehabilitation of the Cebu City Medical Center; accommodation of the 2015 Asia-Pacific Economic Cooperation and International Eucharistic Congress in 2016; and the improvement of the city’s traffic systems, drainage and storm water systems, and other priority government infrastructure projects.

SRP is considered as prime properties that will cater to investments in commercial, industrial, IT and related businesses.

Terms and Reference

Based on the proposed resolution, the qualified bidders shall be Philippine Corporations with a total asset of at least P25 billion based on the 2012 financial statement. They shall have deposited P3 billion three days from the submission of bid.

 The bidders must have been engaged in real estate development industry for a minimum of five years from submission of bid. Furthermore, for that certain period, they must have constructed mixed used projects consisting of 300,000 sq.m., 200,000 sq.m. of which consists of commercial and/or office space and 100,000 sq.m dedicated to residential use.

 The bidders must present a conceptual design upon the conduct of the public bidding.

 Moreover, Castillo said the project area shall consists of 65 percent “buildable zone” while the 35 percent will be designated for open spaces including parks, playgrounds and roadways. It has a minimum floor to area ratio of 1:3.5 mixed use, wherein 70 percent of which will be intended for commercial/or office spaces and 30 percent for residential use.

 The winning bidders of the lots are compelled to give 50 percent down payment upon the awarding of the contract, while the remaining 50 percent will be settled within a maximum period of three years “paid in equal annual installments with six percent per annum.” The buyer will pay all taxes and fees for the transfer of title except transfer tax. 

Investors

Recently, Robinsons Land Corporation and SM Prime Holdings Inc. have sent communication feelers to the mayor’s office expressing their intention to acquire parcels of land at the SRP, particularly Lot 8-B which is located near the Calungsod templete.

 SM Prime Holdings Inc. Market Research and Planning Vice President Ronald Tumao, on the other hand, also expressed interest to purchase lot 8-B, which has an area of approximately 263,384 square meters and costs around P5.4 billion. (FREEMAN)