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The Cebu City government's undertakings in the South Road Properties (SRP) are “grossly disadvantageous” to the city, according to former senator John Henry “Sonny” Osmeña.
Although he appreciated the transparency of the city government in updating him on the city's deals in the SRP, he said planning for the entire reclamation project had been “inadequate.”
“I did not agree or approve of the transactions that were entered into. I think there was no planning that was undertaken. They should have called a professional planner to prepare the development plan for the 300-hectare property,” said Osmeña, estranged cousin of Cebu City Mayor Tomas Osmeña.
The absence of such a plan resulted in deals with private companies Filinvest Land Inc. (FLI) and SM Prime Holdings that Osmena considers disadvantageous to the government.
“They were allowed to slice off the choicest parts of the projects. And nahabilin sa uban kay retaso nalang. They were left with undesirable parts of the land. If they had conducted proper planning of the property, they would've been able to sell smaller lot sizes and hence get higher prices than what they got. Because they were selling in bulk, they did not get the prices that I think they should have gotten,” he explained.
Osmeña was briefed yesterday morning by Cebu City administrator Francisco Fernandez, SRP chief operations officer Nagiel Bañacia, assistant city treasurer Emma Villarete and SRP engineering chief Arnold Favillar.
The former senator was given copies of the city's SRP deals as well as the Commission on Audit's appraisal of the SRP property.
Fernandez told Osmeña of recent developments including the proposal of SM Prime Holdings to buy a 30.4-hectare property.
Villarete told the former senator that the city was able to shed a total of P3.3 billion for the loans of the SRP project but that the sales and lease payments of the private entities could not offset what had been spent over the years.
“They totally ignored the fact that the project cost us as of now P3.3 billion...in real estate development, once you have a finished product and you sell it you can right away recover your investment. In this case, P3.3 billion is not even considered as the investment they are talking about, which is what they have to pay the LBP [Land Bank of the Philippines] which is P700,000 a year,” Osmeña said.
“They make a big issue out of being able to raise the money required to pay the LBP. But that's only the balance of the loan. How about what we have already spent for the loan which is P3.3 billion?” he continued.
Osmeña, however, clarified that although he finds the city's transactions disadvantageous, he is not filing a case against the government.
However, he said that if he gets elected as mayor he will order the zoning of the entire SRP and will be renegotiating with investors to improve the area.
He also said it would be wise if the city government set up public facilities such as hospitals, schools, and bus terminals in the SRP to spur economic development in the area.
