Business: Capitol to Earn P3.5B from Ayala’S P6-B Project
On top of the P6-billion development for the Capitol Civic Center, the Negros Occidental provincial government will earn a total of P3.5 billion from the saleand lease of its 7.7-hectare property to Ayala Land.
Assistant Provincial Legal Officer Mary Ann Manayon-Lamis disclosed yesterday that based on her computation, the provincial government will earn P2,754,890,697 from the lease of 40,481 square meters of its property for 50 years, and P750,033,500 from the sale of 36,587 square meters of property, or a total of P3,504,924,197.
Lamis said that Ayala Land will lease the property at P73 per square meter, and purchase the remaining property at P20,500 per square meter.
She added that in comparison to the offer of SM Prime Holdings, the losing bidder to the property, the Provincial Capitol will earn P3,112,464,973 for the sale and lease of the same property, or a variance of P392,459, 224.
With a P392-million variance, Ayala Land’s improved offer is better and more advantageous to the provincial government, she said.
Lamis said that Ayala Land has already signed the contracts, and the company is ready with its payment.
As stipulated in the contracts, Ayala Land will purchase from the provincial government 36,587 square meters of property worth P750,033,500, subject to an initial payment of 50 percent, with the balance to be paid on a quarterly basis over a one-year period.
To be leased is 40,481 square meters of property at P2,955,113 a month, with rent increasing at 10 percent every five years. Ayala will deposit P35,461,356 covering one year rent, the contracts stated.
Governor Alfredo Marañon Jr. said Ayala Land will start next week its development on the 40,481-square meter property that it is leasing from the provincial government, despite a pending contract still being reviewed by the Commission on Audit (COA). The leased property is located at the back of the Provincial Capitol and portions near the Philippine National Bank.
The remaining 36,587 square meters are under the Contract for the Deed of Conditional Sale still pending before COA.
Lamis added though that Ayala Land is yet to issue a statement about starting their project, and that its officials are yet to meet with the governor about it.
In his Manifestation with Appeal for Resolution submitted to COA, Marañon stressed that the provincial government will be implementing the Contract of Lease anyway, since under the Local Government Code, only the sale or disposal is subject to COA review and approval.
Lamis said they had included the Contract for Lease in the papers submitted to COA for the purpose of transparency, and in order for COA to see the entirety and the impact of the project in its whole development.
In July 2011, the provincial government had submitted to COA the Deed of Conditional Sale and Contract of Lease for the said property.
COA had not decided on the case for almost 12 months already, Marañon lamented.
Marañon has appealed to COA to resolve its review on the contract of the sale of its 3.6-hectare property to Ayala Land at the soonest possible time. The contracts are currently subject to a petition in court by rival SM Prime Holdings, the other bidder to the property.
If approved by COA, Ayala Land will develop the whole 7.7-hectare property into a P6-billion Capitol Civic Center, an integrated mixed-use civic and commercial district, with retail, office, residential and hotel components, which is envisioned to be the growth center of Negros Occidental.*