Filinvest gave best offer for South Road Properties lots – Tomas

By Marian Christie Codilla
Cebu Daily News
First Posted 12:24:00 03/27/2008

A REAL estate firm has the inside track among interested investors negotiating for prime South Road Property (SRP) lots.

Cebu City Mayor Tomas Osmeña said Filinvest Land Inc. has the best offer among the two other investors – SM group and Ayala group.



“I have to look at what is best for the city and so I have to accept the best offer and that is Filinvest,” Osmeña said.

Osmeña, however, did not give the details of the proposal. He said the deal will have to be closed at the proper time because it has to undergo a public bidding.

“I don't mind disclosing (details) but some of them are sensitive about these matters. There is a pressure when we disclose this case because if so, we would have to stop negotiating with SM and Ayala," he said.

He said the best option for the city is to make a deal with only one party and then negotiate with the other two parties.

He said he has not yet started talking with SM and Ayala but they had submitted their offers but he rejected them.

Osmeña earlier said that the three investors were interested to acquire 40 hectares to 50 hectares of the 300 hectare SRP.

He said one investor is interested to construct a high-rise condominium and a mall at the SRP.

Osmeña said that the downpayment of P500 million he expects to receive from one of the investors is enough to pay for this year's amortization with the Japan Bank for International Cooperation (JBIC).

The city government allocates at least P500 million from its annual budget for paying loans for the SRP worth P6 billion. Of the amount, only P300 million represents payment of the city's debt with JBIC while the remaining P200 million is shared by the national government and the Land Bank of the Philippines (LBP).

The national government through the Department of Finance act as the guarantor of the city's loan while LBP is the city's depository bank.
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City Accepts Firm's Plan ( South Road Properties )

Sun.Star Cebu
Wednesday, March 19, 2008

AN official of the Cebu Investments and Promotions Center (CIPC) has announced that the Cebu City Government has accepted the proposal of the Filinvest Group to build a commercial complex in the South Road Properties (SRP).

“The Filinvest proposal has been accepted by the mayor (Cebu City Mayor Tomas Osmeña). The task at hand is to work with COA (Commission on Audit) to make sure it (proposal) has met all the requirements so we can successfully bid it out to any challenger,” said Joel Mari Yu, CIPC managing director.

CIPC is the marketing arm of the SRP, a 290-hectare reclaimed property of the City Government that was funded by a loan from the Japan Bank for International Cooperation.

In an interview with reporters last Monday, Yu said the proposal presented by the Filinvest Development Corp. (Filinvest), a company founded by Cebuano taipan Andrew Gotianun Sr., was to purchase close to 14 hectares at Pond F with the minimum floor price pegged at P15,000 per square meter.

Yu said Filinvest is planning to develop a commercial complex in the area, complete with hotels and shopping centers.

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“But unless COA will put the stamp of regularity, the City can’t bid this out,” he said.

He said Filinvest also plans to acquire an additional 35 hectares at SRP and enter into a joint venture with the City Government to establish a residential complex at SRP, targeting the retirees market.

Filinvest is one of the country’s major conglomerates, with interests in real estate development and leasing, financial and banking services, and sugar. The company is controlled by the Gotianun family through ALG Holdings Corporation.

Yu also said the City Government is now in the final stage of negotiations with two other major investors who are proposing to develop multi-million peso projects at the SRP.

Apart from Filinvest, those who had shown interest in the SRP include: SM Prime Holdings Inc., which plans to build another mall; Container Systems Corp., a Singaporean company that will need 20 hectares; Taiwanese firm Paul Yu Group of Companies; JY Construction; Arcenas Group; Paknaan Central Development Corp.; Mactan Rock Industries Corp.; King Group of Companies; and the University of Cebu.

Yu earlier said that CIPC has projected the sale of half of the titled reclaimed lots this year or at least 100 hectares, with one to three deals to be closed this June.

“If the three are approved this year, SRP will be fully occupied in less than five years, maybe even by 2011,” he said, adding that full development of SRP will bring in an additional 50,000 jobs.

Even if only one of the three proposals is closed this year, Yu said this would already be an “achievement” for Cebu City, especially in generating additional income not only from leased and purchased lots but also from commissions on all utility firms that will operate there. (MMM)

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Tomas eyes building mosque and lighthouse at South Road Properties

The Freeman
Sunday, February 3, 2008

Mayor Tomas Osmeña plans to build a mosque cum lighthouse at the South Road Properties for the Muslim community in the city.

Osmeña, who is an honorary sultan, said he intends the structure to be designed after an ancient lighthouse in Egypt and is eyeing it to be an icon for Cebu and a tourist attraction as well that "even the Sultan of Brunei will come to the SRP."

"I'm going to build a mosque combination of a lighthouse at the SRP. It will look very old Filipino.... pre-Spanish and it's going to be very beautiful and classic and will create an icon for Cebu," he said.

Osmeña said he intends to do a little reclamation for the tower and have a sandbar and causeway leading to the mosque/lighthouse. The construction of the sandbar and causeway leading to the tower alone would already cost around P50 million.

The mayor collects pictures of lighthouses from different parts of the world and has books about lighthouses too. He said the design from Egypt was the best he had seen so far. "I'm very satisfied and it looks very Cebuano. It's perfect for a Muslim tower and it will serve as lighthouse also."

He said that the city will contribute funds for the project but said that most of the funds should come from the Muslim community because the structure’s primary purpose is a place of worship for them.

"The Muslims love me so they made me their Sultan. I love them also so I'm helping them build their mosque," Osmeña said.

The mayor, however, does not know yet when the project will be implemented because it will depend on the investments of the city and the sale of the SRP. - Wenna A. Berondo/QSB

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South Road Properties Cebu’s fountain of wealth

By Ehda M. Dagooc
The Freeman
Thursday, January 17, 2008

Cebu City is seen to become the richest Local Government Unit (LGU) in the Philippines as soon as the South Road Properties (SRP) will start to accommodate operating locators.

Cebu Investments and Promotions Center (CIPC) managing director Joel Mari S. Yu said the city is not relying on the revenue it will generate from lot sales and lease of the 300 hectare economic zone, but rather it will be making more money out of the percentages it can generate from utility and other service providers.

CIPC, a non-profit, non-stock company, owned by the Cebu City government, but privately run, is commissioned to market and promote the SRP.

For power demand alone, the City government stands to get 22 to 24 centavos in every kilowatt consumed by the locators, as franchise fee. In water consumption, SRP management gets P5 to P10 per cubic meter sold.

SRP is projected to consume 99 megawatt in the next nine years for commercial operation.

In telecommunications, SRP will get six percent of the gross income of all telecom companies providing services at the SRP locators.

SRP also gets about five percent in every gross income generated by other service providers, such as security agencies, or other contractors.

According to Yu, SRP will become Cebu’s “source of wealth”. “We will be making enough money.”

“If we will be able to solve all the problems, and finalize all the deals, I am confident that SRP could start to take off within this year,” Yu said.

The 160-hectares of the ecozone, is already being eyed by three big conglomerates in the country. All these three companies have already identified their respective areas within the 160-hectare site.

Yu said Cebu will have to wait for a little more time, as the Cebu City government led by Mayor Tomas R. Osmeña is still clenching good deals with big companies, which expressed strong interest to locate at SRP.

On the other hand, one of the primary problems that keeping the SRP from taking off, is the establishment of a Special Purpose Corporation (SPC), that supposedly will manage the City government-owned zone.

According to Yu, it is very important for the Cebu City government to establish a SPC, as investors are demanding to deal with a privately-run corporation to make sure that SRP will be insulated by political interference.

“As early as five years ago, I already told the Mayor to establish a separate entity to manage SRP. I still stand by it today hoping that he will do it,” Yu said.

The marketability of SRP is very strong. However, the City government should install SPC, just like any successful economic zones.

In the next three years, Yu is optimistic that SRP could generate an average of 50,000 jobs for Cebu.

SRP will not only become Cebu City’s source of wealth, but it will also become the pride of every Cebuano, as development of the coastline economic zone is spectacular, Yu said.

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Cebu City can rake in P8B from 3 South Road Properties investors

By Doris C. Bongcac
Cebu Daily News
First Posted 02:46pm (Mla time) 01/08/2008


Revenues amounting from P8 billion to P10 billion may be added into the coffers of the Cebu City government if Mayor Tomas Osmeña closes a deal with three investors who wanted to acquire portions of the South Road Properties (SRP).

The city government can then take care of its P6 billion loan with the Japan Bank for International Cooperation (JBIC) and spend for basic services that will benefit especially the urban poor.

Osmeña said it will already be easy for the city government to negotiate with JBIC and convince the foreign funding agency to allow Cebu City to rid of its loan guarantors.

The city government allocates at least P500 million from its annual budget for debt servicing. Of the amount, only P300 million represent payment of the city's debt with JBIC while the remaining P200 million is shared by the national government and the Land Bank of the Philippines (LBP).

The national government, through the Department of Finance, acts as the guarantor of the city's loan while LBP is the city's depository bank.

“We plan to negotiate with Japan to waive the guarantee fee. If the project (SRP) is already moving, we will be in a position to take the project away from Land Bank,” Osmeña said.

Osmeña said he is now studying proposals that he received from two of the three investors who are interested at the SRP.

He said one investor is interested to construct a high rise condominium and a mall at the SRP.

He said each of the three investors is interested to acquire of 40 to 50 hectares of the SRP. One investor is interested in Pond F that is located near the sea.

If half of the 300 hectare- reclamation area is sold to investors, this will earn the city P8 billion to P10 billion, the mayor said.

Osmeña however said for this year, he wanted to entertain the best offer submitted by the three investors.

Income is only a secondary consideration. Osmeña said that he is more concerned on how these investors would develop the property to spur the city's economy and create employment opportunities.

The downpayment of P500 million that he expects to receive from one investor is already enough to pay for this year's amortization with the JBIC.

“We only need one of the three investors so we do not get bankrupt. If we close one deal safe na ta. I'm pretty sure of that granting that we do not have an Association of Southeast Asian Nations (ASEAN) crisis next week,” he said.

Having a major investment at the SRP is also expected to boost its marketability.

“I'm pretty sure that even if we get one investor, when the construction starts, the price of land at the SRP will go up anyway,” he said.

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