Real estate board to city gov’t: ‘Excessive’ increase of SRP lot price is “unreasonable”

CEBU, Philippines - The Cebu Real Estate Board Incorporated has pointed out to the city government that if the floor price of the South Road Properties (SRP) increases, investors and developers will no longer purchase lots in the area.

Lawyer Amay Ong Vaño of PAREB-Cebu Real Estate Inc. stressed on the importance of meeting the needs of the investors.

SRP is the biggest asset of the Cebu City government with a total of 300 hectares of land wherein about 90 hectares is already sold to SM Prime Holdings Inc., Bigfoot Entertainment and Filinvest Land Inc while five hectares was donated to the University of the Philippines-SRP.

Cebu City Mayor Michael Rama’s executive assistant, former city councilor Joey Daluz said the appraised value of lots at the SRP is P16,000 per square meter.

However, the committee on awards, headed by city administrator lawyer Jose Marie Poblete plans to increase the lot value to P22,000 per square meter following the major developments in SRP.

On the other hand, Rama wants to increase the lot value to P50,000 per square meter.

Ong Vaño said the amount will never attract local and foreign investors because developing a reclaimed land is highly expensive due to its “poor foundation.”

“The soil under the reclaimed land is relatively soft and it is subject to reshaping and more expensive to develop or to put a sturdier building on that area, meaning the developer has to spend more. So the P50,000 per square meter will not attract businessmen and investors,” Ong Vaño explained.

He added that the said amount is “unreasonable and not viable” to a developer eyeing to put up manufacturing firms, residential buildings and economic zones.

Ong Vaño stressed that a “developer is a businessman who makes sure that the land is profitable because he is responsible for the stockholders of the corporation.”

The position of the real estate sector, Ong Vaño said, is not to increase the floor price of SRP land.

“We believe a real estate not being developed is a liability to the city. The city’s primary purpose is not to be a developer of a real estate property but to render service to the community through tax collections from ownership of land and developed properties, employment, business generation or income and the like,” Ong Vaño added.

In a separate interview, Rama said the amount he mentioned was just his suggestion and not the committee and the council’s view.

“Ako raman to buot-buot nga presyo.” —/ATO (FREEMAN)