City to tackle SM offer to build mall at the South Road Properties

The Freeman
Friday, October 17, 2008

With two proposals worth close to P3 billion already on the line, the City of Cebu is now ready to tackle the offer of SM Properties to buy 50 hectares of the South Road Properties.

Joel Mari Yu, managing director of the Cebu Investment Promotions Center (CIPC), which is the marketing arm of the SRP, said that although the offer sounds very good, the matter of pricing will have to be addressed.

Yu said that SM plans to use half of the property it is planning to buy to build into a two-storey mall while the remaining 25 hectares will be for future expansion.

While a mall at the SRP would really help boost the area, the offer of SM Properties is not high enough to meet the authorized selling price set by the Commission on Audit.

More so, Yu said that if the city accepts SM’s offer, this will not be fair to Filinvest land Inc. and the consortium of Rockwealth Venture Development Inc. and Pueblo de Oro Development Corporation.

Filinvest Land offers to buy 10 hectares of the SRP for P2 billion and has a proposal for a joint development with the city of another 40 hectares.

The Rockwealth and Pueblo de Oro is proposing to buy 10 hectares at P900 million to built a medical tourism facility.

COA has mandated that the lots at SRP be sold at P8,000, P11,000 and P15,000 per square meter depending on the location.

Yu said that the mall at SRP is a very strategic investment that would enhance the value of the entire property, but he said the city government cannot sell the lot below than what is authorized by COA.

“SM is a prime client. Pero dili mi makabaligya ug presyo ubos pa sa ge-authorize sa COA. We even suggested that they should be the one to write COA on this matter,” Yu said.

The proposed medical tourism facility will be bid out next week while the proposal of Filinvest is still being evaluated before any recommendation can be made.

Once that recommendation is made, it will have to be approved by the members of the city council and the mayor before this will be published in newspaper of general circulation for a competitive challenge or competitive bidding.—Mitchelle L. Palaubsanon/NLQ