Cebu City soon to get P348-M for South Road Properties land

Cebu City will soon receive P348 million from the Filinvest Land Inc. as down payment for the outright purchase of a 10.6-hectare lot at the South Road Properties (SRP).

The City Council yesterday authorized the mayor to sign the contract after the Cebu City committee on laws determined that the Joint Venture (JV) contract between the Cebu City government and the Filinvest was legal.

But acting Cebu City Mayor Michael Rama said that he would have to study the contract first before signing.

Cebu City Administrator Francisco Fernandez, who is also the chairman of the Joint Venture Selection Committee (JVSC), said the Council only authorized the mayor to sign the contract and does not mandate Rama to sign it.



But he said he hoped that Rama would agree with the provisions in the contract.

Rama assured his review would not take long as he would be the last person to stop the project.

Tristan Las Marias, Filinvest vice president for the Visayas and Mindanao, asked the city to transfer the title of the two hectares of the 10.6-hectare property covered in the outright purchase to Filinvest once they hand over the down payment.

Upon the signing of the contract, FLI will pay the city P348 million as down payment for the 10.6 hectares which is an “integrated and indivisible” part of the JV contract.

Fernandez said the city will release the titles after receiving payment of Filinvest.

The real estate developer will directly give their installment to the Land Bank of the Philippines being the escrow agent. The LBP will release the titles to the company.

Aside from the outright purchase of the 10.6 hectares, FLI will also develop a 40- hectare property under a profit sharing agreement.

Las Marias said they wanted to lump the two components to make sure that they can give the city P1.5 billion in three years time because it is one of the conditions of the project.

Filinvest will compensate the 10.6-hectare property of the city by annual installment of about P250 million plus 10 percent of the revenues of the developed areas, according to Joel Mari Yu, Cebu Investment Promotions Center managing director and the negotiator of the development.

But Tinago barangay councilor and opposition leader Joel Garganera questioned the realization of this assurance.

“It is not clear if the city can get P1.5 billion in three years because how can there be a gross sale. Can they construct a building within three years,” Garganera asked in Cebuano.

Fernandez, however, said that the first deal for the SRP is the most integral part of the development of the entire SRP.

“The first deal is very important. It does not matter how much money we are going to make,” he said.

“Despite the international crisis, we are very happy that Filinvest is pursuing this. This is not just legally acceptable, it is also economically wise for the city of Cebu,” Fernandez said.

The first development will spur more developments in the 302-hectare reclamation property.