Cebu government eyes P3-B proceeds from sale of reclaimed area South Road Properties

By Wilfredo Rodolfo III
Reporter

CEBU CITY—The city government hopes to raise at least P3 billion as it auctions off a portion of its 260-hectare reclaimed property off the Mactan Channel.

The city council last week gave Mayor Tomas Osmeña authority to sell 32 hectares of prime property at the South Road Properties (SRP) through public bidding. The council also allowed the mayor to start negotiating with other companies for a possible lease or joint-venture projects for the rest of the property.

Councilor Jose Daluz II told Business Mirror on Monday that the 32-hectare property, tagged lot 1-A, would be sold to one buyer. The terms of the bidding will be made public later this week, he added.

Daluz, the chairman of the council’s committee on finance, said City Hall is still deciding on the floor price for the property, but said it would be around P12,000 per square meter.

“This property is very valuable because it is the first lot you will see as you enter the SRP. This is very ideal for commercial businesses like malls,” Daluz said.

The money raised from auction will be used for debt servicing as well as for more development projects in SRP to make the property more attractive to investors. Some of the proceeds will also be used for the city’s services.

He said the second authorization given to the mayor would allow the chief executive to discuss terms with the companies interested in putting up commercial or industrial facilities in the area.

The financial terms of deals, however, would have to go through the City Council for ratification, Daluz said.

The SRP, completed in 2001, was built through a ¥6.7-billion loan obtained by the city government with the Japan Bank for International Cooperation. The biennial amortization would run up to 2020.

The national government then contributed about P10 billion for the Cebu South Coastal Road, which straddles through the SRP.

The city government, however, only officially sealed one deal: A four-hectare lease contract with Bigfoot Global Solutions, which plans to build a film studio on the reclaimed property.

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Council authorizes Tom to sell 31 hectares of South Road Properties

The Freeman
Thursday, August 23, 2007

The Cebu City Council yesterday authorized Mayor Tomas Osmeña to sell 31.9 hectares of lots at the South Road Properties so the city could earn an amount of close to P4 billion to finance more projects.

The city legislators unanimously approved the resolution of councilor Joey Daluz, III to allow the mayor to dispose of properties through a public bidding and hope that such would be the start of SRP’s development.

Mayor Osmeña, who is now on an official trip to India to study the country’s clean and cheap airconditioning systems, said these properties are situated immediately after the viaduct or just across barangay Mambaling, a location he described to be “advantageous to buyers”.

The city would construct signage at the SRP worth P5.2 million and would spend P2.6 million for the landscape at the end of the viaduct, on the right portion of the SRP upon reaching the reclaimed properties from the city.

Osmeña said the properties located at the back where the welcome signage is to be constructed are the same 30 hectares of lots that are first to be sold through bidding.

It was learned from Daluz that the lots were already titled and registered with the Land Registration Authority under the name of the City of Cebu on September 22, 2005.

The mayor said any licensed real estate brokers who could help the city sell the lots at the SRP would be given a two-percent commission out of the proceeds of the sale.

If sale of lots is not done through a broker, the mayor said the commission intended for a broker would be donated to the Emergency Rescue Unit Foundation or to any charitable institution.

As of now, not even a single square meter of the 295 hectares of the reclaimed lots was sold, although an international filmmaker - the Bigfoot - has rented a two-hectare lot for only 40 US cents or about P26 for every square meter.

The city needs P1.7 million everyday to pay for its loan from the Japan Bank for International Cooperation.

Tinago barangay captain Joel Garganera earlier said the city could not sell the SRP lots to the public because until now the property is still being owned by the national government.

He claimed that the SRP lots are still not owned by the city because when President Arroyo issued a proclamation order transferring the ownership of the SRP to Cebu City, she made it without congressional authority. – Rene U. Borromeo/MEEV

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Cith Hall seeing 3 firms to market South Road Properties lots

Sun.Star
Thursday, August 16, 2007


MAYOR Tomas Osmeña said the Cebu City is seeing three appraisal companies for the valuation of South Road Properties (SRP) lots, as it is now engaged in “heavy consultation on who will bid out and where” on the sale of a 30-hectare portion of the reclaimed land.

He said the City is selling because of “liquidity requirements” for the next one to two years.

Otherwise, the City does not intend to sell SRP lots, reiterating his policy to instead have locators introduce projects that would generate jobs.

The mayor said prices of SRP lots are not expected to go down so that those interested must take advantage as “this is a good time to make a deal,” when the City is in need of money to pay its foreign loan.

Defense

Also, the mayor justified the spending of millions of pesos for the SRP welcome signage, saying there is no reason for one to spend on a “nice doormat” worth a few millions pesos when he is selling a multi-million property.

“It is like giving a gift. You spend a little money to put a ribbon, and a wrapper,” he said.

The sign is part of the promotion of the SRP.

To be constructed at the welcome hill leading to the SRP, the sign will be three stories high and will be made of welded aluminum pipes. It is also designed to withstand storms up to signal number five.

The words “South Road Properties” will be spelled out similar to the “Hollywood” welcome sign, and will include the SRP emblem.

Cheap

Last Monday, Osmeña said the welcome sign is the cheap part of the project and that P20 million will be spent to construct a tower beside the sign.

The tower would be built because he did not want a mere water tank to be built near the welcome sign.

A project concept pinned on the wall of his office showed the giant welcome signage with the tank on one side; only that the tank looks like a castle tower complete with battlements.

He said spending for the signage and the tank is similar to parents exhausting their funds to send their children to school.

Although considered extravagant at first light, it really plays an important part in marketing the SRP, he added. (RHM)

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South Road Properties signage to cost P30M

By Doris C. Bongcac
Cebu Daily News
Last updated 02:33pm (Mla time) 08/14/2007

Cebu City, Philippines - The Cebu City government would have to spend at least P30 million for a tower and a signage that would welcome people to the South Road Properties (SRP).

The signage would give the SRP an "identity," which Mayor Tomas Osmeña said would be crucial in marketing the 300-hectare reclamation project.

Osmeña said at least P8.3 million would be needed for the installation of a signage that would be patterned after the famous "Hollywood" signage.

And just like in Hollywood, the signage would also be placed atop a hill that would be landscaped on an elevated portion of the SRP near the viaduct of the South Coastal Road.

Another P20 million would be spent for the construction of a tower that would be designed like a "chess board" and constructed to the left of the SRP signage.

Osmeña said the two structures would be used in the city's design of the SRP logo.

"We are trying to create a branding, a symbol of the SRP," said Osmeña, who added that "branding the SRP is part of the business of promoting the SRP."

On August 8, the City Council passed a resolution by Councilor Nestor Archival authorizing Mayor Osmeña to engage in a contract with Dakay and Development Corporation for the construction of the SRP signage worth P5.65 million.

But a second resolution by Archival, which authorizes the P2.68 million landscaping of the welcome hill by Win Construction, was deferred for review.

"One of the beautification projects to be carried out by the City to make the South Road Properties attractive to investors and tourists alike is the proposed construction of a signage," according to Archival's approved resolution.

The signage, which would be about three-story high would be made out of welded pipes, which Osmeña said may later be clad in aluminum.

"The signage is designed to withstand even a signal number 4 or signal number 5 typhoon," the mayor said.

He said the funds for the landscaping of the welcome hill, which the city already appropriated for, is the "cheaper" part of the city's expense.

The construction of the tower, which is an even bigger expense, would have to wait until the city makes its first sale of the SRP.

Osmeña said at least 30 hectares of the SRP would be bidded out to interested buyers by the end of the year.

Part of its proceeds would be spent for the tower construction worth P20 million.

Aside from its aesthetic features, the tower would also serve as a tank to store whatever amount of water is extracted from the welcome hill.

Osmeña said the tower would also be equipped with a filtration tank and pipes that would deliver at least 20 cubic meters of water to the Metro Cebu Water District daily.

Like Pond A, the welcome hill would also be a good source of water, which can be desalinated to make it potable.

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City Hall spending huge amount for South Road Properties signage

Tuesday, August 14, 2007

The Cebu City government would be spending over P8.3 million for the construction of a welcome signage and for the landscaping of the entrance of the South Road Properties to attract investors.

At least P5.6 million is earmarked for the construction of the welcome signage while about P2.6 million is set aside for the landscaping.

But some individuals said the amount intended for the signage project is too much and that its construction is not an assurance to convince investors to pour investments into the SRP.

But Mayor Tomas Osmeña yesterday defended the amount, saying that what they would be building is not an ordinary signage, which will be constructed by the Dakay Construction and Development Corporation.

According to the mayor, the contractor would build a three-storey building with a terrace where people could view the beauty of the city’s downtown area during nighttime.

The building would be surrounded by a beautiful landscape to be undertaken by the WIN Construction.

City Council majority floor leader Nestor Archival said the Bids and Awards Committee has recommended that Osmeña be allowed by the council to enter into contracts with the two construction companies on the two projects.

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P5.8M South Road Properties welcome sign ‘part of promotion’

CEBU City Mayor Tomas Osmeña justified the P5.8-million construction cost of the welcome sign at the South Road Properties (SRP), saying the project is part of the branding and promotion of the 295-hectare facility.

The sign that will be constructed at the welcome hill leading to the SRP will be three stories high and will be made of welded aluminum pipes. It is also designed to withstand storms up to signal number five.

The words “South Road Properties” will be spelled out similar to the “Hollywood” welcome sign, and will include the SRP emblem.

In a news conference yesterday, Osmeña said the welcome sign is the cheap part of the project and that another P20 million will be spent to construct a tower beside the sign.

Willing to wait

But the mayor is willing to wait until the first sale of SRP lots is finalized before constructing the tower.

“It’s P5.8 million but it’s massive, this is not an ordinary billboard signage. This one is structural and it will be like the `Hollywood’ sign. It can withstand signal number four or five. We’re just trying to create a branding and symbol for the SRP,” Osmeña told reporters.

During their July 18 session, the City Council approved the program of works and estimate, amounting to P5.8 million.

The welcome sign, the Sugbu administrative building, the senior citizens building and an old church at the Kawit Point will all be part of the SRP landscape to help sell the property, he said.

Bidding procedures for the sale of the 30-hectare block after the welcome hill will start as soon as the City Government clears the Mambaling side of the SRP.

Big sign

“The landscape we’re working on is part of the branding for the SRP, it’s all part of the business of promoting the SRP and creating many different opportunities. After our first sale, we’ll put up the tower,” the mayor said.

At the entrance to the SRP, a welcome sign that is under construction is already visible to motorists.

But Osmeña said this is just a mock-up model to determine the appropriate size of the sign, which he said should be big enough to be seen by motorists even before they reach the SRP entrance.

The mayor wants the tower to be multi-purpose, which can have coffee shops and double as a water tank that can hold water from deep wells within the SRP.

Once the 15 deep wells are operational, the City hopes to sell up to 20,000 cubic meters of water to the Metropolitan Cebu Water District.

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Pages pushes setting up of sports hub within South Road Properties

CEBU City sports commissioner John Pages is pushing for the establishment of a sports hub at the South Road Properties.

“I took it up with the other members of the commission, that we need to move forward with this plan,” Pages said.



The commission met last Thursday. Pages said it has been more than a year since the commission announced the plan but so far, it is not even close to being carried out.

“It is still hanging. Right now, everything boils down to the mayor’s approval,” Pages said.

Pages said he understands that City Hall needs to prioritize getting potential investors pick lots at the SRP. However, he said the city could at least designate a portion for the project so that construction can already start.

Short of venues

“We are badly short of venues,” Pages said. With the Cebu Business Park field now converted into a future site for a condominium, the city no longer has a football field.

“We could start with a football field at the SRP. It is the easiest and at the same time, it could be a venue for many other events,” said Pages.

Councilor Sylvan “Jack” Jakosalem said that while there were already initial talks, their attention is now directed toward the P45 million refurbishing of the Cebu City Sports Complex.

The budget, which could possibly come from Malacañang, will be presented to President Arroyo when she comes over next month.

Meanwhile, the mushrooming of various marathons in the city spurred the rescheduling of the Cebu City 21K marathon.

Pages said that they do not want events to overlap so that participation will be concentrated.

The marathon, which features races in the 21 km, 10 km and 5km, will be held on Oct. 14. Pages reiterated that this race is only a preview of a much bigger race they are planning that will coincide with next year’s Sinulog festivities.

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41-hectare South Road Properties lot ready for bidding

Inquirer

CEBU, Philippines—The Cebu City government is ready to bid out for lease or sale 41 hectares of the 300-hectare South Road Properties.

Joel Mari Yu, managing director of the Cebu Investment Promotions Center, said the reclaimed lots include a 30-hectare block, an eight-hectare area because the two-hectare site leased by Bigfoot entertainment and another three-hectare area which is planned as a site for two condominium towers.



“The 30-hectare block has caught the attention of the three biggest land developers Robinson’s Land Corp., Ayala Land, Inc. and the SM group of companies,” Yu said.

The eight-hectare portion includes already the two-hectare site being leased by Bigfoot Entertainment while the other three hectare is being eyed by a joint venture of an American company with partners from South Korea.

Except for the Bigfoot group of companies, all the rest are only interested to lease.

Yu said that Bigfoot wanted to acquire amore hectares to advance further its diverse interest in the information and communications technology (ICT) sector.

Cebu City administrator Francisco “Bimbo” Fernandez said he has prepared all documents for the bidding of the 30-hectare bloc.

“All we are waiting for is the go-signal of Mayor Tomas Osmeña,” Fernandez said.

Once Osmeña gives his go signal, Fernandez said he would publish the invitation to bid in the newspapers.

Yu said the city government needs to hire a professional group to assist in the technical, financial and legal aspects of the negotiation.

Based on the prepared documents of the Cebu City government, the floor price of the 30-hectare bloc is at P7,000 per square meter. The terms include a 20 percent downpayment upon the submission of the formal offer. Another 50 percent upon the awarding of the contract and the remaining balance will be paid upon the signing of the deed of sale.

For the eight-hectare and the three-hectare portion, Fernandez said that the city government was planning to apply the Swiss-challenge mode if approval is given by the Commission on Audit.

Under a Swiss-challenge model, the city government will advertise the price offer of the interested party and will invite other interested parties to match it.

Fernandez said this model would apply to these properties because there are interested parties already.

So far Bigfoot Entertainment is the only locator in the almost 300-hectare reclaimed property of Cebu City.

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