Sell reclamation (South Road Properties) lots without bidding?

By Doris C. Bongcac
Cebu Daily News
Last updated 02:17pm (Mla time) 10/23/2007

CEBU CITY, Philippines - To hasten the sale of lots at the South Road Properties (SRP), Cebu City Mayor Tomas Osmeña wants to skip government bidding processes.


Osmeña said government bureaucracy is causing delays in the disposal of SRP lots, so the city government is in talks with the Commission on Audit (COA) to allow the city to sell SRP lots without auction, but at a price approved by the COA.

“The COA is still considering some of our proposals. Our thrust is to maximize what is beneficial to the city,” the mayor said.

At least three major real estate companies are in talks with the city to acquire lots at the SRP, Osmeña said. He declined to disclose details about the companies or their plans for the SRP.

The mayor said the city would not act on the proposals of these companies unless city officials can be sure of what the companies intend to do with the SRP lots. He also said the city would wait for the COA’s approval to skip the bidding process before disposing of any more SRP lots.

The Government Procurement Act requires the national and local governments to auction the disposal of government properties to get the best possible price for it.

Earlier, Osmeña planned to first sell off 30 hectares of SRP land located near its Welcome Hill to quickly pay off the P6-billion loan from the Japan Bank for International Cooperation to construct the SRP. The rest of the lots would then be leased.

On Monday, however, the mayor said the city government may also sell lots other than those near the Welcome Hill because city officials want to be “sensitive of the market conditions.”

“Some investors are eyeing other parts of the SRP,” he said.

If SRP lots are to be sold without going through bidding processes, the price would be based on the market value approved by the COA, the mayor said.

“The price will be determined by appraisal, but I will put a premium depending on what kind of Establishment is going to be operated there,” he said.

Preference will be given to businesses that would not compete with local industries, such as business process outsourcing.

“We are not selling a piece of land. We are selling development, and we are being picky,” Osmeña said.


The mayor added that he does not want the SRP to end up like Mandaue City’s reclamation project, which, he said, has become a “junkyard for surplus equipment for sale.”

“This (SRP) is one area where we want to maintain certain standards,” he added.

Osmeña said he was confident that the city government would be able to meet its target revenues from the SRP.

He said he expects to earn a total of at least P500 million from the reclaimed property by the end of the year.