Selling SRP lots

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Friday, August 15, 2014

Does the sudden turnaround of some Bando Osmeña-Pundok Kauswagan (BOPK) councilors, who gave authority to Mayor Michael Rama to negotiate with buyers and dispose of South Road Property (SRP) lots, have something to do with the administrative complaint filed by a certain Reymelio Delute before the Office of the President for the release of calamity financial assistance to City Hall officials and employees?

Is it, to use an underworld term, “resbak”?

I ask this question because I cannot imagine these councilors, who are known loyalists of BOPK chief Tomas Osmeña, to make this turnaround. The councilors are Gerry Carillo, Noel Wenceslao, Roberto “Bob” Cabarrubias and Ritchie Osmeña. They joined Team Rama councilors in drafting the resolution.


Nestor Archival and Jun Gabuya were part of the group but later withdrew. Mao ni mga tawo nga walay dugokan ug baruganan. Ritchie, together with Margot Osmeña, Lea Japson and James Cuenco were not included in the case Delute filed. Wenceslao authored the ordinance passed in 2012 that prohibited Rama from selling SRP lots.

When Delute filed the case, some BOPK councilors expressed disappointment over their inclusion knowing that Osmeña was behind it. They felt like they were stabbed in the back.

We will give the concerned BOPK councilors the benefit of the doubt as to their sincerity. Granting that they are all sincere, is this one indication that they have realized that they were all blinded by the decision of Tomas?

Allowing the Rama administration to sell SRP lots would eventually benefit the city and the Cebuanos in terms of revenue generation and employment opportunity. The SRP should be self-generating, meaning that it should earn money to pay the city’s loan obligation to Japan Bank for International Cooperation (JBIC). The other sources of revenue can then be used for more pressing projects of the city government.

What is happening now is that, with SRP’s limited income, the city’s other sources of revenue have been used to pay the loan’s ballooning interest. Mind you, we are talking here only of the interest. SRP's income for now is from the sale of the lots to SM, the city’s joint venture to develop an SRP lot with Filinvest and the rent from Big Foot. A big portion of the 300-plus hectares remain idle.

I am not an expert in real estate, but I won’t go with the contention of Tomas that the city should only dispose of SRP lots once SM and Filinvest start operation as the prices of the lots would have gone up by then. That might be true. But why wait when we can dispose of it now even at a lesser price, with the city immediately getting an income?

Once the titles are transferred to private owners, they will then start paying real estate taxes. The city should not fear speculators because there are terms and conditions for the sale, including a time frame in developing the lots. Is Tomas sure that, after SM and Filinvest start operation, there will be takers when the prices of the lots rise?

The resolution passed by the city council recently laid down the following terms and conditions:

a) Qualified bidders shall be Philippine corporations with total asset, based on 2012 financial statement, of at least P25 billion, and P3 billion should be deposited three days from the submission of the bid. Furthermore, the bidder must have, within the last five years, constructed mixed use projects of 300,000 sq. meters and 200,000 sq. meters consisting of commercial and/or office spaces, with 100,000 sq. meters thereof for residential use. Bidders must have been engaged in the real estate development industry for a minimum of five years from the submission of the bid.

b) The properties shall be sold at not less that P20,000 per sq. meter.

C) A down payment of fifty percent shall be put up immediately upon the awarding of the contract. The remaining balance shall be settled within a maximum term of three years, paid in equal annual installments with six percent interest per annum. All taxes and fees for the transfer of the title except the transfer tax shall be paid by the bidder/buyer.

Syaro og dili gyud makasabot si Tomas ana. Gusto man gud niya nga siya ray makabaligya sa SRP inig balik niya sa City Hall. Kana kon makabalik pa.


Published in the Sun.Star Cebu newspaper on August 16, 2014.


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