Tuesday, October 21, 2008 Mall owner to buy SRP lot
UNSUCCESSFUL with its planned takeover of the South Road Properties (SRP) last year, SM Prime Holdings Inc. now wants to buy a 20-hectare lot for a mix-use development project.
Aside from a hotel and a mall, SM also wants to build two information technology (IT) towers immediately, said Joel Mari Yu, managing director of the Cebu Investment and Promotion Center (CIPC).
Yu said that SM is negotiating for a combination of a lease and an outright purchase of interior lots and some portions along the South Coastal Road.
While they are inclined to enter into a sale and lease agreement, CIPC is not discounting the possibility of a joint venture, he said. CIPC is the marketing arm of the SRP.
“There is a formal offer already from SM and we are making a counter offer. I’m listening to their proposals and, so far, it’s going to be advantageous to the City.
Everything is still under negotiation but Mayor Tommy Osmeña told me to process it already,” he said in a phone interview last night.
Second biggest mall
If their plans push through, SM will build in the SRP the second biggest mall of the company in the country or next to the Mall of Asia in Manila.
At City Hall yesterday, the Joint Venture Selection Committee (JVSC) turned over to Acting Mayor Michael Rama its recommendation to accept, in principle, Filinvest Land Inc.’s (FLI) proposal for further negotiations.
Rama said he will decide on the matter after reading all the details of the unsolicited proposal and the committee’s recommendations.
“Offhand, it was something very attractive but I will have to look at other documents first before I will decide whether I will accept or reject it,” he told reporters.
FLI is proposing to buy 10 hectares of land and to develop 40 hectares under a joint venture agreement with the City. It plans to put up several condominiums, office buildings, a medical and retirement facility in the SRP.
As for SM’s proposal, Yu said that the mall developer had originally planned to buy a 50-hectare portion but found the price too high.
Its officials asked the City to reduce the price but Yu said they cannot do so because the minimum floor price for the three classifications of lots are fixed and was already approved by the Commission on Audit (COA).
In March last year, top executives of SM Prime Holdings Inc. submitted a financial proposal to CIPC on their plan to take full control over the entire 295-hectare facility.
SM’s multi-billion-peso offer included “taking over the full obligation of paying” for the balance of Cebu City Hall’s P6.3-billion loan with the Japan Bank for International Cooperation that was used for the reclamation project. (LCR)
