Labella’s move is a departure from his stance when he was still vice mayor, when he said the deal the city had entered with UHRI was “disadvantageous” to the city.
Labella changes stance as firm hikes investment: Kawit deal now reaches P25B
Jean Marvette A. Demecillo (The Freeman) - September 12, 2019 - 12:00am

CEBU, Philippines — Cebu City Mayor Edgardo Labella has agreed to allow Universal Hotels and Resorts Inc. to continue with the civil works on the proposed integrated resorts and casino project on what used to be the Kawit Island at the South Road Properties.

Labella’s move is a departure from his stance when he was still vice mayor, when he said the deal the city had entered with UHRI was “disadvantageous” to the city.

The mayor’s change of heart comes after UHRI has offered to increase its investment in the project from P18 billion to P25 billion..

He said he is amenable to the recommendation of the city’s Joint Venture Selection Committee, which negotiated with the management of UHRI last month.

“It was the JV committee that met with them. They made a report to me. As recommended by them, I approve it. I never talked to them,” Labella told The FREEMAN.

Labella said he gave the authority for the JVSC to negotiate with UHRI management.

SRP manager Atty. Jose Daluz said the city government would have wanted to amend the Joint Venture Agreement and increase the city’s share of the annual gross receipts from the project from 90-10 to 60-40.

Daluz is also a member of the JVSC.

He said UHRI gave a counter-offer to increase its investment from P18 billion to P25 billion, instead of increasing the city’s share.

“Mura pod og 60-40 na kay P10 billion man ang worth sa atong Kawit Island property,” he said.

In the JVA, the UHRI is to lease the city’s nine-hectare property by paying 10 percent of the gross real estate rental revenues from commercial/shopping center and the parking lots; 10 percent of gross real estate rental revenues from the integrated resort; 15 percent of gross real estate rental revenues from the casino facility; and 10 percent of the gross real estate rental revenues from hotel rooms.

Yesterday, Labella also said the city government will not allow UHRI to have the reclamation rights adjacent to the project site which belongs to the city.

“The foreshore and the reclamation rights will not be granted to them because you can just imagine that if they have the foreshore and the reclamation rights, if they will put up reclamation on the subject property, it will not be owned by the city. So, in this case now, the city can still reclaim the adjacent part and of course that will be owned by the city,” he said.

With the most recent agreement reached by JVSC and UHRI, Labella said he will not stop the development because the cases filed to stop the project have been dismissed already.

Finding no merit, the court dismissed the case filed by Busay Councilman Amilo Lopez who earlier asked the court to stop the city government from entering into a Joint Venture Agreement with UHRI because of three causes of actions, such as:

UHRI does not have the technical capacity to undertake the project provided under the Joint Venture Ordinance; UHRI does not have the financial capacity to undertake the project prescribed under the same ordinance; and City Council did not give authority for then City mayor Tomas Osmeña to sign the JVA with UHRI officials.

Also, members of the previous City Council, namely Councilors Daluz, Jocelyn Pesquera, Raymond Alvin Garcia, Pastor Alcover Jr., Erik Miguel Espina, Joel Garganera, Renato Osmena Jr. and Eduardo Rama Jr. asked the court to declare null the two resolutions with prayer for temporary restraining order and/or writ of preliminary injunction.

Both cases were dismissed by the court.

The project includes the construction of commercial or shopping center, integrated resort facility, convention center, performing arts theater, themed park and iconic public art, three hotels, parking lot, and the casino. (FREEMAN)

KAWIT ISLAND
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