City urged to fulfill obligation in project

May B. Miasco (The Freeman) - October 3, 2015 - 10:00am

CEBU, Philippines – One of the property firms at the South Road Properties is reminding the Cebu City Government of its part in a project that is being undertaken through a joint venture agreement the parties signed six years ago.

In a two-page letter to Mayor Michael Rama dated September 14, 2015, Joseph Yap of Filinvest Land, Inc., followed up on the road concreting project and drainage and sewer line that the city has committed to implement.

The road project covers a 40-meter long SRP Pardo Access Road, which comes along with a drainage system.

“According to the agreement, the city committed to deliver [the two road projects] as requirement before FLI starts to develop the joint venture properties. As of today, sadly, SRP Pardo Road remains incomplete, being only 15-meter wide, and the drainage work along the said road also has yet to begin,” the letter reads.

The statements were stipulated on the Joint Venture Agreement, certified by Rama himself, entered by both parties on March 9, 2009.

Yap said FLI has already completed the development of the first phase of the joint venture properties, has remitted to the city the full guarantee payment corresponding to the first phase of the joint venture, and complied fully with its obligation.

“In this regard, we request the city to likewise fulfill its obligations under the joint venture agreement and complete within the year the 40-meter wide SRP Pardo Access and its corresponding drainage line,” Yap said.

FLI is also asking Rama to prioritize the construction of two commercial roads at the SRP, stressing the same will help address the traffic and flooding problems there.

“As your honor is well aware of, the completion of these roads will decongest the heavy vehicular traffic and reduce the flooding currently experienced along SRP’s main coastal road,” Yap said.

Yap said the construction of one of the roads was also part of the city’s commitment to FLI when the latter remitted the additional amount to complete the guarantee payment for the first phase of the project in May 2014.

“To date, the work on Commercial Road I has yet to be funded by the city and awarded to a contractor,” Yap said further.

Yap stressed that the city has received the full down payment amounting to more or less P8 billion from the successful sale of FLI’s 19.2-hectare property and the 26.3-hectare property from the consortium of Ayala Land, Cebu Holdings Inc. and SM Prime Holdings.

“Together with the other investors in SRP, we would like to request the city to allocate a portion of the proceeds to fund improvement projects in SRP to further enhance its values and make it more attractive for businesses and investments to locate there,” Yap said.

The city government is expecting to get P9 billion since the minimum bidding price of the 19.2-hectare lot is projected to increase to P3.847 billion while the 26.3-hectare property is expected to get P5.267 billion.

Yap said the winning bidders are expected to make their first installment payments by August 2016. —/JMO (FREEMAN)

ACIRC AYALA LAND CEBU CITY GOVERNMENT CEBU HOLDINGS INC CITY COMMERCIAL ROAD I JOINT VENTURE AGREEMENT JOSEPH YAP OF FILINVEST LAND MAYOR MICHAEL RAMA ROAD YAP
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