LITERALLY interpreted, subdividing means the breaking up of one or more large tracts of land into smaller sites or plots. The owner’s intent is to avoid incurring any additional expenses, other than for the purchase, reclamation or survey of land, and placing markers or stakes in intended plot boundaries, as what Cebu City Mayor Tomas Osmeña has done in the South Road Properties (SRP).
The urgent need to pay the obligations for the SRP is basically the main reason the mayor has to dispose of the subdivided plots. His decision to allow private developers to invest in land development in the SRP has its advantage, in helping the City update payments on its loan obligations. A review of the SRP development will show that Pond A has a land area of 886,528 square meters; Pond B, 799,346 sq. m.; Pond C, 80,490 sq. m.; Pond D, 1,106,006 sq. m. and Pond E, 165,134 sq. m. for a total land area of 3,037,503 sq. m. exclusive of the land area covered by Kawit Island.
What is now left as raw land in the SRP is an area of 2,377,503 sq. m. Other areas have been allocated to SM (300,000 sq. m.), Filinvest Land Inc. (300,000 sq. m.), Bigfoot (20,000 sq. m.), University of the Philippines (20,000 sq. m.) and Department of Public Works and Highways (20,000 sq. m.).
Critics are concerned as to how Osmeña will go about the disposal of the remaining raw land. Will he continue to subdivide and sell, or go into the intricacy of land development? Whenever land improvements are carried out in accordance with subdivision plans, and expenditures are made to provide essential site facilities, the field actions are appropriately classified as land development.
What benefit will it do the City of Cebu if land development is pursued in the SRP? To illustrate, when Serging Osmeña Jr. conceptualized the North Reclamation Project, it was designed to be “a city within a city.” Land was subdivided in order to allow the inhabitants of Cebu the opportunity to own a commercial lot. This spread the entrepreneurial spirit of the Cebuanos in the development of their 880-square-meter subdivided lots.
About 160 hectares of the North Reclamation Project were co-owned by the hundreds of individuals and corporate entities that could have created an economic opportunity for many inhabitants.
Unfortunately, then president Ferdinand Marcos took over the reclamation project through his cronies and revised its restrictions. The Martial Law administration then allowed the consolidation of subdivided lots and sold 13 hectares to SM.
The Deed of Restrictions then imposed by Serging Jr. to make the North Reclamation Project “a city within a city” never materialized.
Since the people of Cebu literally own the SRP, will Mayor Osmeña extend investment opportunities in the project site to the inhabitants of Cebu? Although the land developers awarded the rights to develop a portion of the SRP will offer investment opportunities, the limit to ownership will obviously be as condo investors. The restrictions that will be imposed by these land developers will be stringent and hinder some entrepreneurial talents, since all businesses there must fall within their business policies. I hope Mayor Osmeña will provide some areas for the City to undertake land development and provide healthy competition, instead of the giant developers lording it over the SRP businesses.
Although the mayor may have his own solutions to dispose of the SRP, it might be worthwhile for him to consider the wisdom of his father Serging Jr. in creating “a city within a city,” where the wealth of the land is spread to as many inhabitants as possible. For the last many decades, it’s the Chinese mestizos and Chinese who have controlled the economic wealth of Cebu.
It is presumed that care has been taken not to violate the economic law of “highest and best land use,” which is determined by the present worth of future rights to income or amenities. If an oversupply of commercial or residential units saturates the real estate market, economic inability to adjust the supply to active demand will create abnormal vacancy ratios and competitive pricing conditions, upon which real estate depressions have fed in the past.
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