Cebu Offers Reclaimed Area ( South Road Properties ) to Developers

CEBU CITY — The Cebu City government hopes to bid out about half of the 300-hectare South Road Properties (SRP) early this year to pay for some P5-billion owed the Japan Bank for International Cooperation (JBIC).

Three listed property developers, the names of which are being withheld pending Commission on Audit (CoA) approval of the bidding process, are said to have expressed interest in separate lots.

Joel Mari S. Yu, managing director of the Cebu Investment Promotions Center (CIPC), said two firms had submitted proposals while the third promised to deliver its offer before January 15.

"Once we get all proposals, we will evaluate whether these conform to CoA rules and regulations. We don’t know when we can finalize this, but all the major issues have been resolved," Mr. Yu said.

"We made sure that the three developers will introduce different developments so they won’t kill each other. We’re already on the fine print of the proposals," he added.

The CIPC is the exclusive marketing arm of the Cebu City government for the SRP, a reclamation project envisioned to catalyze growth in the southern part of the city.

All three developers plan to embark on mixed-use developments, each with a retail component, Mr. Yu said.

Only one will construct a mall, while another will focus on an integrated approach to providing infrastructure for the information technology industry.

"We’re crossing our fingers that all this will push through. The proceeds will take care of the city government’s amortizations for not just this year," he said.

The city government secured a ¥12-billion loan in 1995 for the reclamation project, which was renamed South Road Properties and declared a special economic zone in 2005.

All three interested bidders are listed on the Philippine Stock Exchange, Mr. Yu said.

"We have to clear everything with the CoA. The city government wants to make sure that it’s right the first time. And we have investors who don’t want to get egg on their faces," he said.

Last April, SM Prime Holdings, Inc. President Hans T. Sy confirmed that his firm wanted to acquire part of the SRP. Mr. Sy then said they planned to introduce a mixed-use development similar to the SM Central Business Park in Bay City in Pasay.

SM Prime has just completed the expansion of the SM City Cebu mall, called the Northwing, and is currently scouting for properties in Cebu for two more malls. SM is also on the lookout for two more properties in "certain strategic targets in the Visayas".

There are presently four SM malls in the Visayas — one in Cebu, one in Bacolod City in Negros Occidental, and two in Iloilo City.

Other developers that previously reported to have expressed interest in the property are Ayala Land, Filinvest and Robinsons Land.

Officials of these companies have declined to confirm the reports.

Mr. Yu has assured prospective locators at the SRP that there will be adequate power and water. Visayan Electric Co., Inc. has installed power distribution lines while Mactan Rock Industries, Inc. has built a desalination plant that can supply a minimum of 800 cubic meters of bottled-quality water per day.