Development of Cebu’s SRP

CEBU CITY—The Cebu City government is hoping to settle development plans with interested locators at the 240-hectare reclaimed South Road Properties (SRP) in the next three months, City Mayor Tomas Osmeña said.

The mayor said development plans are being shuffled back and forth between interested developers and the city, which he admitted is being “choosy” in the development it wants on the property.

“I am the problem. I am very strict in the development in the area. If I don’t want their plants and their structures, I send back the plans to them [developers],” Osmeña told BusinessMirror.

He said, however, that discussions are going into the right direction, and agreements on the development plans and structures could be accomplished before the end of the first half of 2008.

“The SRP will come into full bloom in the next three months. The mango that we planted is not only flowering but is already bearing fruit,” he said.

The SRP, completed in 2001, was built through a 25-year loan package obtained by the city government from the Japan Bank of International Cooperation (JBIC). The deal was the first major overseas-loan package obtained and being paid for by a local government unit to a foreign funding institution.

“Our critics said the city will go bankrupt because of this loan. We are not bankrupt and this project will make us less dependent on financial help from the national government,” the mayor said.

After the agreement on the development, however, the developers and the city would have to undergo bidding on the property after the Commission on Audit (COA) ruled that the city could not enter into negotiated sale or lease for the property.

“COA required us to go through bidding, but I don’t see any problem in that,” the mayor said.

At least three realty development giants are positioning to get huge parcels of land at the SRP for various projects, the mayor announced earlier. The developers are eyeing leisure, residential and business-process outsourcing areas.

A separate area is also being set aside for industrial locators.
Article source: BusinessMirror

3 Projects at SRP

THE marketing arm of the South Road Properties (SRP) has assured the three proposed multi-million projects at the 290-hectare reclaimed property will not compete with each other.
Joel Mari Yu, managing director of the Cebu Investments and Promotions Center (CIPC), said the three major investors behind the projects will be occupying a combined area of about 160 hectares at the SRP.



“One will build a mall, the other will build an integrated IT (information technology) complex and another will construct condominiums and a retirement center,” Yu said in a recent interview with reporters.

“They have agreed that … they will not be competing with each other,” he said.
Yu, however, declined to provide details about the three big investors as each are still in negotiations with the Cebu City Government.

Investors

Those who had shown interest in the SRP include: SM Prime Holdings Inc., which plans to build another mall; the Filinvest group, which plans to build a commercial complex; Container Systems Corp., a Singaporean company that will be needing 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.

He said the CIPC is already in the final stage of negotiations with the three buyers, following the release of a memorandum on the price of the lots.

Yu said each buyer wants to purchase 40 to 50 hectares. Should negotiations “run smoothly and favorably,” work on the proposed projects will begin in the second quarter of this year, he added.
“If the three are approved this year, SRP will be fully occupied in less than five years, maybe even by 2011,” he said.

Achievement

Even if only one of the three proposals is closed this year, he 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.

Citing a memorandum from the city mayor’s office, Yu said the price offer for lots at Pond F, which makes up the entire 1.4-kilometer stretch facing the sea, is at least P15,000 per square meter. He added that the whole stretch could easily earn for the City more than P2.5 billion, depending on the winning bid.

Yu said any bidder who offers below P15,000 per square meter for Pond F lots will immediately be disqualified.

“This will be the same for the rest of the lost. That’s why before the end of the year, we expect 50 percent of SRP to be sold,” Yu said.

For lots located within 80 meters on both sides of the South Coastal Road and the Mambaling Access Road, the minimum floor price is at P11,000 per square meter.

All other lots outside Pond F and those along the two main roads are considered non-prime properties and will be sold for a minimum price of P8,000 per square meter or leased for P28 per square meter per month.

Yu said the full development of SRP will bring in an additional 50,000 jobs in the area.
The SRP was funded by a loan from the Japan Bank for International Cooperation.

Article source: Sun.Star Cebu

City Accepts Filinvest’s Plan

“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.

Additional area“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.

Article source: Sun.Star Cebu