City awaits formal proposal: P18B project at SRP

CEBU, Philippines — A giant company has proposed an P18 billion mixed-use development project at the eight-hectare Kawit Island property at the South Road Properties (SRP), Mayor Tomas Osmeña announced yesterday.

“They will spend P18 billion for a hotel, restaurant, casino, and convention center. There will be 1,000 rooms, four towers. When you spend P18 billion, you will have a lot of facilities, a yacht club, island cruises, a water park,” the mayor said.

JG Summit Holdings, Inc. is expected to submit to the city a formal unsolicited proposal within the month, he said.

He said JG Summit Holdings, Inc. will soon announce a new corporation as a foreign partner will assist in the multi-billion project.

Osmeña said he is eyeing at closing the deal within the month so that the process of the unsolicited proposal will move forward after negotiations with the executive department.

“Unsolicited proposal is unsolicited. In other words, the city did not specify what amount and then they submit a proposal to the city and then we will question it, we will negotiate, it will go to the City Council,” the mayor explained.

Once the project is accepted by the city government formally, it will be presented to the public for a possible “Swiss challenge,” which would give other companies the opportunity to match the proposal.

Even with a challenge, the original proponent can still submit a counter-proposal if it wants to get the project back.

If it pushes through, the project will hire at least 8,000 workers, not to mention more investments and businesses, Osmeña said.

Based on initial talks, the city will get up to 15 percent of the project’s gross sales.

Osmeña said investor will lease the city’s property for at least 50 years.

“We’re giving them a grace period of so many years. It’s in their interest to get it started right away because the clock starts clicking now. Why will you wait until the grace period is up? So, they make money before the deadline, that’s all yours,” he said.

Impact

Osmeña believes the announcement of the project will result in the increase of the value of properties at the SRP.

“With this announcement, this will bring up the prices of the SRP. This will put the focus back in the SRP into the forefront of Cebu’s development,” he said.

The city government is now planning at sell at least three hectares of land at SRP at P110,000 per square meters.  Before the announcement of the project, Osmeña said he has received a proposal of P115,000 per square meter from an undisclosed company.

The mayor said the P18 billion investment will possibly draw more buyers of the three-hectare lot sale.

“The important essence here is it will bring up the price of all our properties at SRP,” he said.

Osmeña said it will take at least three years to construct the P18 billion project. Since it will be established at the Kawit Island property, the existing structures there, which include the Senior Citizens Building, will reportedly be transferred to the senior citizens’ park at the expense of the investor.

Osmeña said he wants to name the project “Isla de la Victoria.”

“My proposed name is going to be named after an employee Jojo de la Victoria of Bantay Dagat Commission. I don’t know if they will consider it… Isla de la Victoria because it gives it historical significance,” he said.

In April 2006, former Bantay Dagat Commission director Elpidio 'Jojo' de la Victoria was killed reportedly because of his crusade against illegal fishing. (FREEMAN)