Saturday, September 29, 2012

Gates, Buffett again top billionaires’ list



NEW YORK—Microsoft Corp. cofounder Bill Gates remains America’s richest man by far, as the tech and philanthropy giant took the top spot on the Forbes 400 list for the 19th year running, with a net worth of $66 billion.
Investor Warren Buffett, the head of Berkshire Hathaway Inc., again took second with $46 billion, while Oracle Corp. co-founder Larry Ellison remains third with $41 billion and brothers Charles and David Koch, co-owners of Koch Industries Inc., tied for fourth with $31 billion.
Forbes said the rich mainly got richer in 2012, with net worth rising for 241 members of its list and shrinking for only 66. Rising stock prices, a rebound in real estate values and rare art prices helped.
 
More members of the Walton family, the founders of Wal-Mart Stores Inc., moved up into the Top 10, displacing investor George Soros and Las Vegas Sands Corp. founder Sheldon Adelson. New York City Mayor Michael Bloomberg, who made his fortune with the financial data services firm Bloomberg LP, is also back with the top dogs at No. 10 with an estimated net worth of $25 billion.
Social media moguls took the biggest hit. Zynga Inc.’s Mark Pincus and Groupon Inc.’s Eric Lefkofsky dropped off the list entirely. Facebook’s Mark Zuckerberg was the biggest dollar loser in Forbes’ latest ranking of the 400 wealthiest Americans. The company’s lackluster IPO in May resulted in a huge drop in market value that cut the value of his shareholdings almost in half, costing him $8.1 billion in net worth. That dropped Zuckerberg from No. 14 on the list to No. 36.
But although Zuckerberg lost more money than most people will make in many lifetimes, his net worth still totals an estimated $9.4 billion, according to the magazine.
(AP)

In Photo: This June 26 image provided by Forbes, and the pullout cover for the magazine’s Sept. 21 issue shows from left to right: Warren Buffett, Oprah Winfrey, Bill Gates, Melinda Gates, Pete Petersen, Leon Black, Jon Bon Jovi (seated on the ground), Marc Benioff, David Rubenstein, Steve Case, Laura Arrillaga-Andreessen and Marc Andreessen posing for a portrait in the Trustees Room at the New York Public Library in New York. The 12 individuals shown were part of a group attending a Forbes convened event called the Forbes 400 Summit On Philanthropy. During the event, the magazine’s editors invited 12 of the leading philanthropists in the US to pose for the portrait. (AP Photo/Forbes)

Macquarie has P26-B equity fund for PHL infra projects


THE Macquarie Group of Companies, one of the interested bidders for the P60-billion Light Rail Transit (LRT) Line 1 Cavite Extension Project, said it has as much as $600 million, roughly P26 billion, in equity fund that could be spent for Philippine infrastructure projects.
“We are interested in road, rail, airports. In general, we are interested in power…. We’ll have a look at social infrastructure like schools and hospitals.  We try to be as flexible as possible,” said Michael de Guzman, managing director of Macquarie Capital, at the sidelines of the 2012 Philippine Energy and Infrastructure Business. 
 
“I can’t comment on that until we are asked to disclose,” she said, when asked which local company Macquarie was partnering with for the LRT Line 1 extension project.
Asked to elaborate on the $600 million, he said it is an equity fund. “Typically, in a project there is a primary
sponsor like a Philippine conglomerate and they may need 30 percent to 40 percent equity partner or tap loans from banks. That’s where we come in,” de Guzman added. He said Macquarie has no preferred conglomerate.
The fund, according to de Guzman, may be spent in two years in five to 10 varying infrastructure projects. If additional funding is needed, Macquarie can “continue to supply funding.”
Aside from the Cavite Extension Project of the Light Rail Transit Authority, Macquarie also procured documents for the Ninoy Aquino International Airport Expressway project, which is included in the Public-Private Partnership (PPP) Program of the Aquino administration.
Aside from Macquarie, other firms that had purchased pre-qualification documents for the LRT Line 1 Extension Project were San Miguel Infra, Mitsubishi Corp., D.M. Consultant Inc., Hanjin Heavy Industries & Construction Co. Ltd., Sumitomo Corp., Leighton Contractors, SyCip Salazar Hernandez & Gatmaitan, FSG Capital Inc., EFC Enterprises, FF Cruz & Co. Inc., Marubeni Corp., BPI Capital Corp., ING Bank, Jorgman Planning & Development Corp., RATP Development, Benchtel Overseas Corp., Comm Builders & Technical Philippines Corp., Lenvoisa Construction Inc., APT Global Inc., Makati Development Corp., Tranzen Group, Serco Group, Cathay Energy Service Corp. and Systra Group.
The deadline for submission of requirements of interested bidders is on Friday, September 28.
Meanwhile, an official of the Department of Transportation and Communications said during the same meeting that they are undertaking a study to extend the LRT Line 1 project from Bacoor to Dasmariñas, Cavite.
“We hope that by the middle of next year, we will be able to get that structured and get that out to bid by the third quarter of 2013,”  Transportation Undersecretary Rene Limcauco said.
The LRT Line 1 Cavite Extension Project costs P60 billion. This extends the existing 20.7-kilometer LRT Line 1 system, which runs from Roosevelt Avenue in Quezon City to Baclaran in Parañaque City, by an additional 11.7 km southward to Bacoor, Cavite.
Eight passenger stations with a provision for two additional stations, one satellite depot and three intermodal facilities, are part of the project. Two provisional stations in Manuyo Uno in Las Piñas City and Talaba in Cavite are also being proposed.
Once completed, the new line will increase ridership of LRT Line 1 from 500,000 to 700,000 passengers per day and thus, provide faster and more convenient alternative to residents of Cavite, Las Piñas and Parañaque.
The project cost will be equally split between the private sector and the government, which will spend for the purchase of up to 39 new car train sets and construction of the satellite depot, among others.
Another train project that will be bid out is the LRT Line 2 East Extension Project, a 4-km line to Masinag Junction in Antipolo City.
“We got the LRT Line 2 extension approved by the Neda [National Economic and Development Authority] about three weeks ago. This costs P10 billion and will be funded through GAA [General Appropriations Act], ODA [Official Development Assistance] and PPP. We will bid out the operation and maintenance of this line,” Limcauco said.

2016 target: 45M tourists, P2-T revenues, 7M jobs



THE Philippines, by 2016, will attract at least 10 million foreign tourists and 35.5 million local ones, earn P1.99 trillion in tourism receipts and generate 7 million jobs for Filipinos, according to Tourism Secretary Ramon Jimenez Jr.
Jimenez cited on Wednesday budget airlines or low-cost carriers offering lower rates and better deals and the government putting in place infrastructure projects, including roads and airports, to ease visitors’ transfer to must-see destinations in the country.
 
He told delegates to the Pacific Asia Travel Association (Pata) Travel Mart on Wednesday that major infrastructure projects to improve the country’s tourism sector “are in the offing, mostly at the bidding stage, as the government’s  decision to go for  seamless travel [across the country] is all in the works.”
Jimenez said new airports would be built in Daraga, Albay, in the Bicol region and Bohol in Central Visayas. He added that the three terminals of the country’s premier Ninoy Aquino International Airport would be rehabilitated to ease congestion and improve safety.
Pata Vice Chairman Rick Anderson, in the same gathering, said the Philippines is likely to achieve its targets for the tourism sector. He also cited the Philippine economy as one of the fastest-growing economies in the Asia-Pacific region.
“The Philippines is a tourism giant now flexing its muscles…there is now greater awareness [in the world about the Philippines],” Anderson also told a news briefing during the Pata Travel Mart, which  started on September 26 and will end on the 28th.

PHL ‘invulnerable’ to external shocks



THE Philippines has developed to a point where externally driven shocks, like the ongoing global downturn, no longer render the economy vulnerable to foreign-capital outflows, economist and Monetary Board member Felipe Medalla told thrift bank executives on Tuesday.
He told the Chamber of Thrift Banks the economy has amassed a wealth of resources—some $80 billion worth at present—which has helped insulate the country from some of the nastiest ill effects of the sovereign debt and financial crisis in Europe and the low growth prospects of the US, which is still the country’s largest trading partner.
 
“We are practically invulnerable to capital flow reversals,” Medalla, who once served as socioeconomic planning secretary and director general of the National Economic and Development Authority, said.
This particularly pertains to gross international reserves of $80 billion at present or enough resources to cover a year’s worth of goods imports or pay for services and income.
The increase in foreign-currency reserves run parallel to such improvements as the rising level of gross savings and gross capital formation in recent years, Medalla said.
These developments, taken together with billions of dollars worth of foreign-currency earnings of some 8 million overseas Filipinos, allowed the economy to post 10 consecutive years of current-account surplus in the balance of payments.
“This helped raise our gross international reserves, making our external balance virtually invulnerable to global shocks like the collapse of the Lehman Brothers,” he said.
Until it closed shop in late 2008, Lehman Brothers was the fourth-largest investment banking outfit in the US recognized for the key role it played in the unraveling of the global economy.
“In short, we don’t need foreign funds,” Medalla said.
Nevertheless, Medalla said the Bangko Sentral ng Pilipinas, to which he is part of the seven-man policy-making Monetary Board, is forced to buy some of the yield-seeking dollars coming into the country to help temper the value of the local currency, the peso.
“If we didn’t buy all those foreign exchange, the peso would have appreciated and that would be bad for Filipinos. This is more preventive than anything. In addition, the reserves are a form of insurance,” he said.
He gave assurance the release of local currency with each purchase of dollars should not kick inflation higher in the coming months as these have been “sterilized” with the artful use of special deposit accounts (SDA).
Medalla said some P227 billion worth of liquidity entering the system was effectively siphoned off and shunted during a 30-day period ending on August 3 this year.
As a result, the SDA facility has now attracted P1.79 trillion worth of funds that would have expanded money supply and contribute to inflation conflagration, Medalla said.

Sept. inflation at forecast range of 4.3%



Inflation that has been accelerating since July this year was forecast to remain elevated in September, averaging from a low of 3.4 percent to as high as 4.3 percent, regulators said on Thursday.
According to Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr., much of the pressure on prices was owed to volatile oil in the world market whose full impact was dampened only by the softening of other key price drivers.
 
“Our inflation forecast range for September is 3.4 percent to 4.3 percent. This continues to reflect manageable inflation pressures, as the impact of oil-price volatility is expected to be dampened by lower electricity prices and broadly stable food prices,” Tetangco said in a text message.
Expectations of sustained and higher prices in September followed a period of decelerating inflation in the opening months, when inflation fell from 4 percent in January to only 2.6 percent in March.
Inflation would later rise to 3 percent in April but moderated again thereafter to 2.9 percent in May and still lower to 2.8 percent in June, after which the rate steadily went up.
These developments would later compel the BSP to refine its forecast inflation for this year and next to
3.4 percent from 3.1 percent originally and to 4.1 percent from 3.2 percent, respectively.
Accelerated prices in the Philippines have also caused analysts at Singapore-based DBS Bank to fine-tune the country’s inflation path this year to 3.9 percent instead of 3.7 percent in its original forecast.
The recalibration was prompted in part by sustained local output in the second quarter when the economy expanded at a sustained pace of 5.9 percent from 6.3 percent a quarter earlier.
Global lender HSBC has seen accelerated growth in the third quarter and expects prices to continue to pick up during the period.
This was the reason the policy-making Monetary Board of the BSP kept policy rates unchanged at its rate-setting meeting just weeks earlier.
“While headline inflation is still within the 3-percent to 5-percent target and unlikely to breach the upper bound in 2012, headline inflation is trending upward. Most worrying is the unfavorable base effect in the first quarter of next year—should it be coupled with high demand and global commodity prices, the target would be breached,” HSBC said early this month.
Nevertheless, Tetangco gave assurance that the monetary policy settings remain appropriate and supportive of non-inflationary growth and vowed the seven-man board will remain vigilant against global or domestic developments that could upset the relative stability in local prices.

Philippine GDP outlook raised to 6-7%



THE country’s improved economic prospects in the past few months have prompted the local think tank First Metro Investment Corp.-University of Asia and the Pacific (FMIC-UA&P) Market Research Center to upgrade its full-year economic forecast for the country to around 6 percent to 7 percent this year.
In a phone interview, UA&P Senior Economist Victor Abola said the higher forecast stems from expectations that consumer spending would remain robust for the rest of the year on the back of benign inflation. Earlier, the think tank estimated full-year growth at 5.5 percent.
 
Full-year gross domestic product (GDP) growth, Abola said, would also be supported by higher public- and private-construction spending as well as some amount of election spending toward the end of the year, around November and December, in preparation for the 2013 local elections.
“With industrial-electricity sales growth zooming to a two-year high of 19.7 percent in May, and public spending up by 18.3 percent, and new jobs still over 1 million in April, the outlook for GDP hike in the second quarter looks even more promising than the first quarter. This, together with the rest of the outlook below, enables us to upgrade our full-year projection for GDP growth to 6 percent to 7 percent,” the report said.
Abola said strong full-year growth would also be supported by robust GDP numbers in the second quarter. He said the think tank estimates a growth of 6.5 percent to 7 percent in the April-June period, higher than the first quarter’s 6.4 percent.
The growth drivers in the second quarter, he said, includes higher infrastructure spending, the recovery of the manufacturing sector, higher consumption spending compared to the first quarter, and stronger exports.
Inflation in the April-June 2012 period averaged 2.9 percent, below the Central Bank’s 3-percent to 5-percent target this year. Exports in the April-May period, on the other hand, averaged 13.65 percent.
Abola noted that the business-process outsourcing and tourism sectors posted a 15-percent growth in the quarter. This means that the services sector, a major source of growth for the Philippine economy, would post stronger growth than in the first quarter.
“The upgraded outlook for 2012 second quarter GDP expansion is more remarkable, given the slowdown of the US economy and China, two main engines of world growth, and the lingering banking and debt crisis in the euro-zone focused on elections in Greece, which held the world in tenterhooks. The outcome was fairly positive. No Grexit followed by some concessions by Germany in favor of growth for beleaguered Spain and Italy, core countries in the euro zone,” the report stated.
Earlier, National Economic and Development Authority (Neda) Director General Arsenio Balisacan said that this year, he expects economic growth to be within the government’s 5-percent to 6-percent growth target. He said this target has already incorporated the impact of the crisis in Europe and any slowdown in China.

CV economy grew 7.9% in 2011

By Elias O. Baquero Wednesday, September 26, 2012
THE National Economic and Development Authority (Neda) yesterday said that the Central Visayas economy is one of the fastest growing in the country with 7.9 percent economic growth in 2011.
Speaking before the Agio (Association of Government Information Officers) Forum, Neda 7 Assistant Director Efren Carreon said the areas of interest of investors in Central Visayas are in information technology and business process outsourcing (BPO), tourism, real estate development, and retail trade.

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Carreon said around 60,000 workers are employed in the IT-BPO sector. If the employees have an average salary of P20,000, this translates to more than P1 billion in monthly payroll money from abroad coming to Cebu.
“That’s why banks and restaurants are sprouting because aside from BPO, there is a boom in the construction industry,” Carreon said.
But Carreon also said the government must also look at safeguarding the welfare of workers in the IT-BPO sector since it is new. One of the concerns is that it is difficult to determine when a call center will close shop, and if it does, it would leave workers suddenly unemployed, unpaid and without benefits.
Trickle down
Carreon said that another thing the government should do is to find out how the economic growth can trickle down to ordinary people.
“We are not happy if there are beggars on the streets because this will mean they failed to get their share of the economic growth,” Carreon said.
The Neda official said that based on Gross Regional Domestic Product (GRDP), Visayas economic growth is driven by industry and services.
In the industry sector, the growth of the construction industry went up from 10.6 percent in 2010 to 21.5 percent in 2011.
Carreon said it is in this sector that poor people who have no proper education can be employed.
Service sector
For the service sector, transport, storage and communications went up from 2.6 percent in 2010 to 6.1 percent in 2011.
The real estate renting and business activities also went up from 10.2 percent in 2010 to 10.9 percent in 2011.
“We have to promote as many industries as we can in order to create more employment opportunities, which will lead to more income, increase in the demands for goods and services, hence, increase production,” Carreon said.
According to Carreon, they want to maintain the 7.9 annual economic growth in order to reach an average of 7.2 percent by 2016.
Jo Villamor of the Department of Trade and Industry (DTI) said her agency is helping the countryside in raising the people’s income.
She said DTI led the people into subcontracting the production of goods where exporters buy their finished products.
For the first semester of 2012 alone, Villamor said they have generated 17,657 jobs and P109.9 million in income.
Published in the Sun.Star Cebu newspaper on September 26, 2012.

Friday, September 28, 2012

Gaisano Grand group launches real estate arm

By Mia A. Aznar Tuesday, September 18, 2012
KNOWN for its chain of retail stores, the Gaisano Grand Group of Companies is introducing its real estate arm with the launching of its first medium-rise condominium project, the Grand Residences.
Within 10 years, the developers hope to be able to complete their urban resort community in Barangay Kasambagan, which will comprise six residential towers, clubhouse with multi-purpose halls and function rooms, swimming pool, gardens and other amenities.

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For now, they want to begin constructing the first tower by year’s end and complete it by the last quarter of 2014, said project head consultant Jan Eric Menguito.
The first tower will consist of 247 units combining studio, one-bedroom and two-bedroom units. The first tower is expected to cost about P350 million.
Communities
Grand Land president Ryan Bernard Go assured that the units are sold “at reasonable prices,” at P77,000 per square meter, but that they offer value with the amenities available.
Go said they began organizing the real estate arm in 2011, adding that residential areas go hand in hand with department store development. He said that with Grand Land communities that they build, there could also be a Gaisano Grand Mall nearby.
As for the Grand Residences, both Go and Menguito said an area set aside for future development could be the next location for another Gaisano Grand Mall but a more upscale version to cater to the mid-market residents of the development.
As for their other residential projects, Go said most of these are also near Gaisano Grand Malls such as their developments in Mactan and future plans in Davao City.
Menguito said that this was a good way for the Gaisano Grand Group to grow because it complemented their existing retail business.
Menguito does not believe there is a real estate bubble in Cebu, saying the prices are still reasonable while interest rates are at a good level at six percent.
They are giving themselves a year to sell all the units. So far, they have sold 35 units since they began selling last month.
Wide open spaces
Menguito noted that with top real estate development companies all flocking to Cebu, they have to be able to compete by providing the best possible product.
Sales and marketing vice president Tina Pestaño-Mendez said the Grand Residences offer what other projects cannot, which is wide open spaces in an urban setting.
The project site sits in Kasambagan, which can be accessed through Gov. M. Cuenco Ave. and Pres. Roxas St.
The developers also assured they will dedicate 65 percent of the project to open space, which is an attractive feature for those with children, said Mendez. The property is 3.2 hectares.
Published in the Sun.Star Cebu newspaper on September 19, 2012.

Tourism sector eyes bigger market

By Mia A. Aznar
Thursday, September 27, 2012
AS THE World Tourism Organization sees the Asia Pacific region as the next region to see in 10 to 20 years, local tourism stakeholders are aiming to get the Philippines on the large global tourism market.
Research, Education and Institutional Development (REID) Foundation vice president Cherrylyn Rodolfo, who presented to local stakeholders the state of Philippine tourism, said the country is ready to take advantage of this due to its strategic location in the Asia Pacific region and in Southeast Asia.

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The Asia Pacific region has an annual tourism growth rate of 6.3 percent while Southeast Asian countries grew 6.8 percent.
She said that if the Philippines wants to catch up with its neighbors, it has to come up with new products to offer tourists. Rodolfo said the country had a “dismal performance” from 1980 to 2010.
They learned that it takes a visitor several years to realize his desire to travel to the Philippines. When they determined to find out why, she said there were indications that tourism suppliers had to turn guests away at certain times of the year due to a lack of capacity to accommodate them.
There is also a lack of products to lure them.
These, she said, were mostly during peak season.
Constraints
“So even if the Philippines was number one in their list, the visit was not realized because of the constraints they faced,” said Rodolfo.
Still, she believes the landscape of Philippine tourism is about to change, with the government completing its National Tourism Development Plan (NTDP) to come up with competitive tourism products, enhance connectivity and strengthen governance.
Rodolfo noted that in the product portfolio of the Philippines, which are sun and beach, culture, nature and cruise and nautical tourism, Cebu is able to offer all of these. “The question now is, do we want to part of that growth or are we content to watch at the sidelines?” she told those present.
Following the NTDP, she said some provinces have begun setting up their own tourism plan. Rodolfo said Cebu seems to have a major role for many of these provinces.
She explained that the Mactan-Cebu International Airport serves as a major gateway to many provinces and that the success of these destinations will also depend on how well the airport is positioned. She was glad to hear of the plans to expand it and added that the airport still has room for expansion so that it can serve other tourism development areas.
Rodolfo cited Bohol as a province that considers its linkage with Cebu as critical to their tourism plans and that there have been moves to work on tourism loops similar to what Hong Kong and Macau have. She said this can be explored by improving the ferry services and the port facilities and offering online bookings.
Competitors
Despite Cebu’s critical role in the development of other provinces, Rodolfo warned that even if they can be allies, these other provinces could also become competitors if Cebu does not work on its own tourism plan. Currently, there are plans to complete an international airport in Panglao, Bohol while other airports are also being improved. She added that Iloilo, which is the third busiest airport in the country, currently has no international flights. However, it will start its international flight to and from Hong Kong by November.
Published in the Sun.Star Cebu newspaper on September 28, 2012.

Local language skills draw e-marketing firm

By Katlene O. Cacho
Friday, September 28, 2012
AN electronic marketing (e-marketing) firm is banking on Cebuanos’ excellent communication and inherent entrepreneurial skills to expand its “mobilepreneur” base in the country.
Noel Velasquez, president and chief executive officer of Planet Mobile Technology, said the Cebuanos’ ability to speak Filipino, English and Cebuano will help the company attract more entrepreneurs to join their growing team.

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Planet Mobile is a division of Planetbiz International Inc., established in October last year.
It is an e-marketing firm that distributes products and telecommunication services using social marketing strategy. The firm is supported by an Internet distribution system and a third-party secure e-payment process.
The company was founded by a group of business people who have been in the multi-level marketing industry for more than two decades. The group is composed of marketing, sales, information technology, and communications practitioners.
“The company aims to empower consumers. We educate them about the products and services being offered,” Velasquez said in an interview. “Companies approach us to market their products. We help them increase their sales.”
Velasquez said they call their sub-dealers “mobilepreneurs” whose function is to educate all prepaid users on the importance of having post-paid plans and “how they can maximize their expenses and generate income.”
A mobilepreneur is given a virtual office where he/she can manage his/her own business, facilitate product orders, or even accept secured payments via web or mobile device.
As of August, Planet Mobile has about 1,350 mobilepreneurs, mostly from Cebu. The company targets to reach at least 5,000 members by yearend.
“We have chosen Cebu as a jumping point, being the gateway to other points of the country. Cebuanos’ ability to speak Filipino, English and Cebuano will allow us to expand our base in the country and even to other countries,” he said.
Planet Mobile carries the products of Globe Telecom’s SME post-paid, prepaid plan and Gcash Powerpay + and Sotelco’s I-connect VOIP service.
They also ventured into consumer products, partnering with Monde Nissin Corp. to market Lucky Me’s Nam Nam, an all-in-one seasoning mix.
Velasquez said the one-time membership fee of P3,735 comes with a business kit. Planet Mobile Technologies recently opened its hub at the Mango Square Mall.

Published in the Sun.Star Cebu newspaper on September 29, 2012.

Thursday, September 13, 2012

Marco Polo Residences endears itself to Cebuanos



  
WITH its beautiful beaches, tropical climate and relaxed urban lifestyle, Cebu City, the Queen City of the South and the oldest city in the Philippines, has become a much sought-after haven for foreign retirees, drawing the international crowd like bees to flowers. Cebuanos are known to be the most hospitable and caring people in the country. No wonder that a lot of foreigners now live in the city for business and leisure. Add here the Mactan International Airport, which has international flights to Singapore, Hong Kong, Kuala Lumpur, Taipei, Korea, Japan and China.
Now, another industry that is growing in the city is real estate. Over the years, more people are moving to Cebu due to the presence of new developments like the prestigious Marco Polo Residences and the Southern gem, which have made Cebu an even more attractive place to live in.
On top of the beautiful and overlooking city of Cebu located at the Nivel Hills in Apas is the famous Marco Polo Plaza Hotel. The establishment opened in 2006 after Metrobank, the biggest bank in the country, acquired the property from the owners of the Cebu Plaza, which ceased operations in 2003. Since its inauguration, the Marco Polo Plaza Hotel has become the favorite venue for family events and vacation destination for both the locals and foreign visitors.
 
Now, five residential buildings next to the hotel are being built and they will rise in the next few years—The Marco Polo Residences. The units in Tower 1 have been sold out two months after they were launched, while 75 percent of Towers 2 and 3 have been sold. The investment on this project is between P15 billion and P20 billion, according to Alfred Ty, president of Federal Land.
“The Marco Polo Hotel is very dear to the Cebuanos. It’s sentimental to them. This is where they had their special and memorable events. The intention of the residences is to have the hotel amenities for the home­owners,” said Ty. “The unending stories I hear are nostalgic, and the Marco Polo Residences will make us closer to the community.”
Ty further shared, “We are encouraged by the strong market response. It was exciting to see the response of foreign and local retirees from abroad.”
With a name that is globally prominent in the hotel and hospitality sector, the Marco Polo Residences has since become an ideal investment among foreign retirees and expats settling in Cebu. Following the successful unveiling of its first two towers, a third structure will soon rise within the premises of the Marco Polo Residences.
The third tower, dubbed as the Marco Polo Parkview Residences, is a highly anticipated addition to this exclusive community located at Nivel Hills in Cebu. Federal Land Inc., the premier property developer behind this luxury development, is pleased to report a favorable take-up since its launch.
The Marco Polo Parkview Residences is envisioned to become a fancy retreat for the upscale market. Its members-only club shall serve as a playground for the cosmopolitan crowd. Here, they can indulge to their heart’s content in the pleasures of appointed features such as a lap pool, fully equipped fitness center, spa, private theater and tennis court.
The Marco Polo Residences sets itself apart from its peers in the local property sector with its world-class facilities and services that synthesize Asian hospitality with Western innovations. The legendary brand of Marco Polo also gives it a unique distinction from other luxury high-rise developments in the market.
Residents of the Marco Polo Residences can enjoy access to the Marco Polo Hotel and its hotel amenities and services. These include food and beverage signing privilege; concierge, room, business center and laundry services; apartment cleaning, servicing and maintenance; and priority access to the swimming pool, gym and the wellness zone. Apart from the stunning view, the charm of the Marco Polo Residences lies in its five-star hotel-like amenities, well-appointed units and first-class services. Each unit was designed to exude contemporary, stylish living suited for the distinct tastes of its residents.
The hotel-like ambiance cascades to the common areas with its grand ground floor lobby and drop-off. Security is a top priority with CCTV system, automatic fire suppression system, fire detection alarm system, stand-by generator for both common and residential units, and 24-hour security and maintenance personnel.
Visit www.marcopoloresidences.com.ph for more information or see its showroom in Manila at GT Tower International, 6813 Ayala Avenue corner H.V. de  la Costa Street in Makati. For Inquiry, please call +639173236123.


In Photo: Marco Polo Parkview Residences and Dining area

Study: One strong earthquake can devastate Metro Manila




THE two consecutive earthquakes that jolted Eastern Leyte and Bukidnon last week created panic in the affected communities.
While the impact of the magnitude-7.6 earthquake that hit Eastern Leyte and the magnitude-5.6 earthquake in Bukidnon was minimal because very few people inhabit the areas hit, they nonetheless struck fear in the hearts of Filipinos, aware that the country itself is on the Pacific Ring of Fire.
Remembering the 1990 earthquake that brought down vibrant Baguio City, the country’s summer capital and a prime tourist destination, to its knees, the question lingers: What would happen if an earthquake of such strength hit Metro Manila in the dead of the night? Or even during hours when people are in their workplaces?
 
With an estimated population of 12 million and towering residential and commercial buildings scattered all over it, what would be the impact of a magnitude-7.2 earthquake when it hits Metro Manila?
Still recovering from the effects of Tropical Storm Ondoy in the last quarter of 2009 and the heavy rains induced by the hanging habagat, or southwest monsoon, just last month, disaster preparedness initiated for the inundation remains sadly wanting.
Earthquakes are considered far deadlier than other natural calamities, their impact on lives and property far more severe than the flash floods that residents of Metro Manila and other low-lying areas in the provinces have experienced with intense typhoons, heavy rains and widespread floods, which are, in fact, now being considered the “new normal” because of the advent of climate change.
Earthquakes are known to cause buildings and bridges to collapse, trigger widespread fires, cut power, water and means of communications, create tidal waves or tsunamis and wipe out entire cities from the map, such as the one that triggered a tsunami and eventually a nuclear crisis in Japan.
A study conducted by the Philippine Institute of Volcanology and Seismology (Phivolcs) in 2004 showed that one strong earthquake—with a magnitude ranging from 6.5 to 7.9 on the Richter scale—can devastate Metro Manila and create complete chaos, even without the aggravating circumstances of a nuclear disaster as had happened in Japan.
Metro Manila lies along the path of several fault lines, including the West Valley Fault and the East Valley Fault, which makes it “highly at risk.”
The study, titled “Earthquake Impact Reduction Study for Metropolitan Manila in the Republic of the Philippines,” was conducted in collaboration with the Metropolitan Manila Development Authority and the Japan International Cooperation Agency. The study developed 18 earthquake scenarios, and provided concerned government agencies a picture of what could happen should such a devastating earthquake take place.
The distribution of ground motion, seismic intensity, liquefaction potential and slope stability were calculated for the earthquake scenarios by experts that pictured a “doomsday” scenario for Metro Manila, the seat of economic and political power in the Philippines.
Three of the scenarios—the West Valley Fault, the Manila Trench and the 1863 Manila Bay—could cause severe damage to Metro Manila, according to the study.
The West Valley Fault and the East Valley Fault that run north to south along the west and east edge of Marikina Valley are thought to pose the greatest threat to Metro Manila due to their proximity, the study said.
According to the study, a magnitude-6.5 to 7.9 earthquake striking Metro Manila is no longer in doubt.
“The likelihood of an earthquake of such magnitude to happen is certain.  What we are not sure about it is when it will happen,” Ishmael Narag, officer in charge of the Seismology Division of Phivolcs, said.
A magnitude-7.2 earthquake, one of the scenarios developed, can devastate Metro Manila.
With such magnitude, people are forcibly thrown to ground.  Many cry and shake with fear.  Most buildings are destroyed. Bridges and elevated concrete structures are toppled or destroyed.  Numerous utility posts, towers and monuments are tilted, toppled or broken. Water sewer pipes are bent, twisted or broken.  Landslides and liquefaction with lateral spreadings and sand boils are widespread.  The ground is distorted into undulations. Trees are shaken very violently, with some toppled, broken or uprooted. Boulders are commonly thrown out. River water splashes violently on slopes over dikes and banks.
In the first hour, according to the study, its impact is estimated to destroy 168,300, or 12.7 percent, of the 1.33 million residential buildings in the metropolis, and damage 339,800, or 25.6 percent.
Of the estimated 9.93 million people of Metro Manila, some 34,000, or 0.3 percent, would die, 90 percent of them inside the collapsed buildings; at least 113,600, or 1.1 percent, of the total population would sustain injuries. The injured may suffer trauma and bone fractures caused by the collapsed building and falling furniture.
The figure, according to the study, includes trapped people who are not immediately rescued from collapsed buildings and who may eventually die.
But the study revealed that in case of such a strong earthquake, the number of fatalities in squatter areas would be minimal.
In the next three to seven days, aftershocks would cause further building damage and some 1.26 million people would lose their homes and would have to seek shelter elsewhere for safety.
Habitation in high-rise residential buildings would become impossible.
As the earthquake inflicts damage on buildings, electric cables and telephone posts are tilted and broken; there would be no power and electricity, no means of communication and even water supply as the movement of the ground could also severely damage water facilities—and the main sources of water for Metro Manila’s supply, the La Mesa Dam.
Worse, public buildings, such as hospitals, schools, even fire departments, police and even local government units (LGUs), could be heavily damaged, making it difficult for rescue, relief and eventually rehabilitation effort more difficult.
The study estimated that of the 981 medium-rise buildings (10 to 30 stories), 11 percent would be destroyed and 27 percent damaged; of the 119 high-rise buildings (30 to 60 stories), 2 percent could be destroyed and 12 percent damaged.
The expected simultaneous outbreak of fires in about 500 different areas could be triggered by electricity short circuits. Fire in factories, hospitals, residential kitchens, petroleum and LPG leakages from storage tanks could also happen simultaneously within an hour after the earthquake.
Runways in airports could be damaged, and airports could encounter problems as a result of damage to airport facilities.  Eventually, runways would be closed and only helicopters would be available.
Ports and harbors could also be damaged and tilted by liquefaction, while severe damage to roads and bridges would render major roads impassable, making distribution of relief goods, food, shelter and, more important, medicines for the injured and the sick in evacuation centers more difficult.
The scenarios also indicate that even Malacañang, the House of Representatives and the Senate buildings would suffer damage, as well.  Official functions would be severely limited, therefore.
But Narag was quick to note that since the study was conducted and completed in 2004, Phivolcs and other concerned agencies have been closely coordinating to strengthen and prepare for the worst-case scenarios.
He said, in fact, the upgrading of the National Disaster Coordinating Council to the National Disaster Risk Reduction and Management Council was a major step in putting in place disaster-risk reduction plans against all kinds of natural calamities, including devastating earthquakes.
According to Narag, the study’s recommendations and action plan were already integrated in the master plans of various government agencies and some LGUs.
“The Department of Education and other concerned agencies are continuously conducting earthquake and fire drills in schools.  The Department of Public Works and Highways is also looking into the structural defects of buildings and is making sure that proper engineering designs are in place,” he said.
The Department of Health, he said, had also crafted a master plan in case of such disaster.
The Philippine National Police and the Bureau of Fire Protection, he said, are also well aware of what to do in case of such national emergency.
“Even LGUs are strengthening their disaster risk-reduction strategies, and earthquake is one of those they are preparing for,” he said.
Some barangays, in fact, are conducting their own earthquake, flood and fire drills, he added.
The study urged concerned government agencies to prepare and draft master plans to reduce the risk of disasters.
But Narag said the impact of a devastating earthquake as developed in the 2004 study needed updating.
He said that by now, the number of people living in Metro Manila has gone up. There are also more residential and commercial buildings, as well as public infrastructures such as bridges and flyovers.
According to Narag, the impact of a devastating earthquake in Metro Manila is expected to radiate to neighboring towns and cities in the provinces near it.  Even Rizal, Cavite, Laguna, Bulacan and Pampanga may be severely affected and their governments would not be able to provide help for Metro Manila because they would also need to look after their own people.
“The impact of an earthquake could be worse if we are not prepared for it.  That’s why our ongoing risk-assessment project covers even floods and other geological hazards,” he said.
Narag said proper information, education and communication is important to make people aware of the potential impact of strong earthquakes and what needs to be done in case of emergency.
According to Narag, Phivolcs, in collaboration with the Australian Government Overseas Aid Program, the Philippine Atmospheric, Geophysical and Astronomical Services Administration, the Mines and Geosciences Bureau and the National Mapping and Resource Information Authority and concerned LGUs, is conducting similar “risk analysis projects” to include the possible impact of a devastating earthquake on neighboring provinces such as Rizal, Cavite, Laguna in the south, and Bulacan up to Pampanga in the north.
The new study, he said, would be comprehensive and hopes to come up with, like the 2004 study, sets of recommendations and action plan designed to reduce the risk of disasters as a result of a devastating earthquake.
“We are targeting the release of the study by the end of March next year,” he said.
The new study, he said, will update data and records, such as the population, number of residential and commercial buildings, identify schools and hospitals, pinpoint bridges and overpasses, and other public infrastructures that are potentially at risk in Metro Manila, as well as in Rizal, Cavite, Laguna, Bulacan and Pampanga.  The study, he said, would also come up with recommendations to help prepare the various stakeholders in case of such tragedy.

Building a new city from scratch




MANY an urban planner probably dreams of a chance to build a new city or area from scratch, working with a clean slate, so to speak. This chance comes once in a while when, for example, one is able to work with a newly reclaimed piece of land sufficiently large to work in many of the ingredients that a small town or city would need. The project is further enhanced when and if a substantial property is made available, one the size of a major metropolitan city itself.
Well, the government now has such an opportunity to work with such an area, one that has been around for some time, with interesting infrastructure already in place. Depending on how much land is allowed to be freed up, the land astride the Clark Ecozone that makes up the Clark Subzone, stretching from the towns of Bamban to Capas at one end, and all the way up to Crow Valley at the other end, could come up to a total of at least 30,000 to 60,000 hectares. 
 
The topography is interesting, too, starting with the Sacobia River and a low-land plain that gradually morphs into a hilly and sub-mountainous terrain. The higher areas would appear to be like what one would find in Tagaytay ridge itself, probably higher, leading to cooler weather and freedom from the oppressive heat that one finds in the typical metropolitan area.
Of course, the former American bases, namely Subic and Clark are nearby, which would provide the necessary logistical and transportation hubs needed to support such a magnificent enterprise.
Furthermore, the new city would probably have to be put up along strict clean, green, and ecologically sound lines, with lots of trees and plants abounding to make the whole city a pleasant place to live in. Utilities would be placed underground; power and water would be generated, using the latest in clean and green technologies. Mass transportation matrices would be part of the mix, and roadways made sufficiently wide with room for expansion in the future. Biking and hiking trails would be part of the equation, and these would pass through a substantial number of urban mini-forests and parks. Would this not be a wonderful place to live and work in?
In fact, if I and some friends have our way, we would make it a punishable crime to litter streets or one’s environs, or to even cut down any tree. All trees will be numbered and catalogued, especially since the promotion of native species will be undertaken. Maybe, if the economics warrant it, a two-pipe system for water would be mandated or encouraged, so that drinking water would be separated from brown recycled water that could be used for flushing toilets, watering plants, and the like.
Consider further, the possibility of moving the seat of government into the new city to be created, which would probably be midway up the hilly areas. This would give planners an opportunity to work out the proper structures to be set up at levels that would free these establishments from the vagaries of flooding and traffic, among the more annoying problems that plague a metropolitan area.
This would free large areas of land within Metro Manila that could be converted to better uses, and maybe keeping the existing government buildings as the metropolitan regional office. This strategy would then mimic similar moves made in Malaysia, Brazil, and other countries that have separate areas that allow for planned growth in the future.
BCDA already has a master plan that is in the process of being drawn up for a substantial portion of the property. But even as this plan is being developed, the idea is beginning to excite some people who see this area as a place for future business and residence.
A word of warning though to those who think that they can get away with the usual highest and best-use type of development in the new green city: DON’T! The whole idea is to migrate away from the type of willy-nilly development that we now see in Metro Manila, the creation of a concrete jungle that only increases the carbon footprint of the country and fails to improve the lifestyle and level of happiness of its inhabitants.

SM cautious on Asean, keeps focus on China expansion




RETAIL, mall and banking conglomerate SM Investments Corp. (SMIC) may be one of the most aggressive companies in the country today but when it comes to expanding to newer markets in Asean, the group is taking a more cautious approach.
SMIC chief financial officer Jose Sio told reporters in a chance interview on Tuesday that the company is shying away from expansion opportunities in Asean given its lack of expertise in this region’s markets.
Earlier, the SM Group said it was looking to put up malls in Vietnam and Indonesia.
Sio, however, clarified that those offers were for the group to manage existing malls, as the owners of these shopping centers hoped to replicate the SM Group’s successful model that has made it the Philippines’s largest mall operator today.  
He said the group had to turn down some offers.
“To manage a mall, you have to know retail. If you don’t know retail, you don’t know your tenant,” Sio said at the sidelines of the launch of the Asean Corporate Governance Scorecard on Tuesday.  “What I’m saying is SM knows retail in the Philippines but we don’t know the market in Indonesia or Malaysia.”
He said the group’s international strategy is still hinged on expanding in China.
 
The SM Group, through shopping mall arm SM Prime Holdings Inc., currently operates four malls in China, but Sio said they have yet to scratch the surface of the market’s potential there.
“China is big enough,” Sio said.
The company announced earlier that expansion efforts are set to ramp up in China, with shopping mall unit SM Prime Holdings Inc. planning to open as many as two malls per year starting 2014 from the current pace of one shopping center annually.
This is the same year it plans to open SM Zibo and SM Tianjin, which will be its biggest mall to date and will span over 530,000 square meters in floor area. 
SMIC shares declined 0.07 percent to P721 each on Tuesday, giving the company a market value of P442.6 billion.

In Photo: SM mall in Xiamen

DMCI to construct twin towers in Davao




DAVAO CITY—Property developer DMCI Homes is putting up its first high-rise development beside its condominium project here south of downtown Davao.
Leonora P. Gutierrez, chief marketing officer of DMCI, said the twin towers—rising at 28 stories—are expected to help address the surge in demand for residential units for transients, travelers and businessmen resulting from the expansion of the city’s economy over the last three years.
 
The twin towers project will start almost simultaneously with the expected construction in the downtown area of another twin towers by the Ayala group and a hotel building of the FTC Group north of downtown. Local powerhouse FTC is an affiliate of AGL Sons Inc., which is known to be one of the leading operators of commercial buildings and real estate developments in the province. Four other mid-rise hotels were expected to come online next year to bank on the holding of the MICE Convention in March next year. MICE is an acronym for meetings, incentives, conferences, and exhibitions.
Development cost for the DMCI twin towers is expected to reach P3 billion. It will be situated at the DMCI property in Ecoland Village near the Times Beach area and the newly built SM shopping mall. It would occupy two hectares, of which 1.2 hectares would be the building area while the other 8,000 square meters would be devoted to commercial units.
She said the proposed height of the twin towers had been approved by the Civil Aviation Authority of the Philippines.
Construction is expected to start next year and may be finished in three years. 
This would be the fourth major project of the company here, including the city’s first condominium, a hacienda-inspired subdivision and another subdivision in Catalunan Pequeño.
Residential projects are also expected to start in two western barangays here, where the educational center and resort spots are situated, and in three other towns of Sultan Kudarat and Maguindanao.

P-Noy: PHL to hit 5%-6% GDP target despite euro-zone woes




Despite the specter of worse financial troubles in the euro zone, the Philippines is expected to hit its 5-percent to 6-percent growth target for the year, President Aquino said on Wednesday.
Mr. Aquino made the statement at the IBM Think Forum at the Makati Shangri-La Hotel, where he narrated positive developments in the Philippine economy in the face of worrisome external developments.
“I am sure you have all heard that, in the second quarter of 2012, the Philippine economy grew by 5.9 percent. If all goes as planned, we’ll be on target in achieving between 5-percent to 6-percent GDP growth for 2012,” he said.
 
In a media interview, Mr. Aquino said economic growth will be driven by infrastructure development, investments, agriculture and public spending, and that computations for the first two quarters of the year—6.3 percent and 5.9 percent, respectively, showed average growth exceeding  target.
“Let’s just look at this—6.3 and 5.9 is 12.12, right? Divided by two is 6.06…. So far, we have exceeded the 5 to 6 [percent],” he said.
In his speech, he said in the midst of financial troubles in Europe where the embattled Greek economy had stoked the “fear of the unknown” among other governments, the Philippines had managed to significantly improve its competitiveness ranking in the World Economic Forum’s Global Competitiveness Report for 2012-2013.
“These achievements, together with the 44 record highs of the Philippine Stock Exchange Index, and the fact that the Philippines is now only one level below investment grade, according to two of the three major ratings agencies, show that we are well on our way to filling up the half-full glass,” he said.
Referring to the unstable Greek economy, Mr. Aquino said, “This fear of the unknown is feeding on itself, and spiraling into what may become a greater crisis, which benefits neither the people of Greece, nor other citizens of the euro zone or, as Madam Christine Lagarde’s position is, nobody is immune from the crisis in the euro zone.”
Lagarde is the managing director of the International Monetary Fund (IMF), and had addressed leaders including Mr. Aquino at the Asia-Pacific Economic Cooperation Summit in Hawaii last year and in Vladivostok, Russia, this year.
“In both meetings, Madam Christine Lagarde…made references to external pressures and factors that can impede, and have already impeded, the progress of some global economies—but at the same time, these factors can also open up new prospects for others,” he said.
The President said that emerging markets like the Philippines “are given the opportunity to make the most of their competitive advantages and become prime locations for investment” as capital flowed out from developed but troubled economies.
The President also lauded IBM Philippines, which celebrated its 75th anniversary, for betting on the Philippines.
“Instead of fearing the unknown, your leaders saw an opportunity to bet on the Philippines and to bet on the strengths of your company. Today, we can all agree: those bets have indeed paid off,” he said.

Monday, September 10, 2012

Central Visayas investments hit P4.9B


By Mia A. Aznar
Friday, September 7, 2012
SOME P4.9 billion worth of projects have been registered with the Board of Investments (BOI) Cebu extension office for the first half of the year.
These are expected to generate 1,059 jobs.

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The BOI Cebu extension office recorded 13 projects for the first semester, with an additional three approved last July and August amounting to P232 million. Eight of these projects are in Cebu, while Bohol and Siquijor have one project each. Three projects have been registered for Negros Oriental.
Four of these projects are for mass housing, four are for renewable energy, two for tourism, two for export and one is for bulk water supply.
Filinvest Land Inc. submitted a total project cost of P2.1 billion for its San Remo Oasis project, expected to generate 352 jobs. Its One Oasis Cebu project has a total project cost of P891 million, with an estimated 174 jobs available.
Quadriver Energy Corp. registered a renewable energy project for P1.4 billion in Bohol, while PNOC Renewables registered three renewable energy projects in Negros Oriental.
Housing, expansions
Mandaue Cebu Marine Products plans to produce fish fillet products and registered a project worth P86.2 million with an estimated 256 jobs available.
Last year, first quarter investments amounted to P2.1 billion and 534 jobs, while the second quarter yielded P4.02 billion in investments with 1,915 jobs. These included housing projects, hotel modernization, and expansion of iron and steel business.
For January to April 2012, Central Visayas was among the sixth top investment destinations in the country, the BOI said in a previous report. It received P2.19 billion in investment commitments.
Central Luzon was the top investment destination for that period, with P56.08 billion in approved projects. Region 4 and the National Capital Region rounded up the top three. Western Visayas (P16.37 billion) and Davao (P2.87 billion) preceded Cebu on the top investment destinations list.
Published in the Sun.Star Cebu newspaper on September 08, 2012.

Pilipinas Water to pour P2.5B into SRP water supply project

By Katlene O. Cacho
Friday, September 7, 2012
WATER technology system provider Pilipinas Water Resources Inc. (PWRI) is earmarking P2.5 billion in investments in the next five years to ensure sustainability of the total water management project for the South Road Properties (SRP).
PWRI Director Antonio Camelo Tompar, in an interview, said the amount will cover the technical work that would produce 35,000 cubic meters (cu.m.) of water supply per day.

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Tompar said the supply is expandable to 50,000 cu.m., which is more than enough what the SRP requires.
Tompar said the firm has purchased and put in place imported pipelines to ensure better service to SRP locators. A stable water supply at SRP is among the demands of conglomerates like Filinvest Land Inc. and SM Prime Holdings Inc.
From the sea
In 2010, the Cebu City Government signed a 30-year contract with PWRI for the water supply in the SRP, which City Hall reclaimed using a loan from Japan. Under the agreement, the PWRI will use the existing city-owned desalination and waste water treatment plants located in the SRP.
Better pricing and environmental sustainability are their project’s value proposition, he said.
PWRI plans to sell the water at P5 (per cu.m.) less than the current water price of Metro Cebu Water District (MCWD). They would also re-sell the treated water or recycled water at P10 (per cu.m.) less.
He said the firm will use seawater desalination, which he described as “very sustainable.” Seawater desalination is the process of converting seawater into potable water.
Tompar, who is also chairman of Mactan Rock Industries Inc., also announced the expansion of Mactan Rock to serve the water requirements of Tacloban, Iloilo and Coron in Palawan.
He said the company got a local franchise to supply water for the underserved areas of Tacloban.
The initial development will yield 20 cu.m. per day, which can be expanded to 5,000 cu.m. per day using the surface and well water treatment.
Mactan Rock will also be serving the Dumangas-Barotac Nuevo Water District with 3,000 cu.m. of water supply per day, which can be expanded to 30,000 cu.m. per day. The firm will develop and distribute some 3,000 cu.m. of water supply per day to Coron, Palawan to address the water requirement of its growing tourism sector.
Published in the Sun.Star Cebu newspaper on September 08, 2012.

2 giants want Cebu airport award

Monday, September 10, 2012
CEBU CITY -– The Ayala Corp. and Aboitiz Equity Ventures Inc. (AEV) have signed a joint venture agreement to compete for the new passenger terminal project at the Mactan-Cebu International Airport.
“We cannot think of a better partner for this project than the Aboitiz group, who has not only built a long history and heritage in Cebu, but also has a successful track record in undertaking significant projects in multiple industries,” Ayala Corp. President and Chief Operations Officer Fernando Zobel de Ayala said in a press statement.

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Between them, the two listed companies have stakes in power, telecommunications, banking, construction, real estate development and management, food processing, business process outsourcing and transportation, among others.
The Mactan passenger terminal project, estimated to cost P10 billion, is one of the ventures on the priority list of the Aquino administration’s Public-Private Partnership (PPP) program.
In their press statement, Ayala and Aboitiz said they have signed an agreement to form a 50-50 joint venture company that will serve as their vehicle to bid for and develop the second biggest airport in the country.
The Mactan Cebu International Airport Authority (MCIAA) said the existing terminal building was built in 1995 with a capacity of 4.5 million passengers per year.
mciaa terminal
READY FOR TAKE-OFF.  The Neda committee in charge of big-ticket infrastructure projects may deliberate this or next month, and if all goes well, the public-private partnership project to build a new passenger terminal may be awarded next year, MCIAA General Manager Paul Villarete says.(Allan Cuizon)

MCIAA General Manager Nigel Paul Villarete said the capacity was breached in 2009 yet, with 4.7 million passengers. This year, seven million passengers are projected to use the facility.
Homegrown
Ayala said both organizations “strongly believe in the potential of the Mactan Airport to be a compelling gateway to the country for international passengers and to the Visayas for the growing domestic travelers.”
AEV President and Chief Executive Officer Erramon Aboitiz, in the same press statement, said: “We are equally excited about this partnership with Ayala, especially as it is for a project that gives AEV the opportunity to enter into a strategic new segment that is crucial to developing both the country’s transportation infrastructure as well as its tourism potential.”
“Moreover, the fact that the project is in Cebu, which is home to the Aboitiz Group, gives it more special meaning to us,” he added.
While not homegrown like Aboitiz, Ayala Land is responsible for the Cebu Business Park, the Ayala Center Cebu, the Asiatown IT Park and some high-end residential developments.
terminal optimism
TERMINAL OPTIMISM. This artist’s perspective of what the Mactan Cebu International Airport could look like was among the documents in a feasibility study assisted by the Korean International Cooperation Agency. (Contributed photo/Mactan Cebu International Airport Authority)

According to the PPP’s website, the project involves the construction of a passenger terminal building with a capacity of about eight million passengers per year, and the operation and maintenance of both old and new terminals.
The project has an indicative project cost of US$241.7 million, with the Department of Transportation and Communication (DOTC) designated as implementing agency.
2015 or later
Villarete said, though, that the final project cost will depend on the winning bidder’s design. The design will be prepared by the prospective concessionaires, based on standards, specifications, and service levels set by DOTC.
Projects of this magnitude take five to seven years of gestation, from the start of the feasibility studies to the start of operations, Villarete said. The studies of the new terminal should have started in 2005 so that it could be opened by the time the existing terminal reached its full capacity.
But he said the feasibility study was started in 2010 so they are looking at 2015 or later for the opening of a new terminal.
Based on MCIAA records, Villarete said the annual passenger movements were 4.7 million in 2009, 5.4 million in 2010 and 6.2 million in 2011.
In an interview yesterday, Villarete declined to say who the other probable bidders are, saying only that they will be announced in due time.
“But I can tell you that many are interested. Around 20 firms attended the first market sounding at the PPP Center last May, both local and foreign airport operators, banks, construction companies, systems services and investment groups, and many others have signified their interest,” he told Sun.Star Cebu.
Timetable
He added that the bidding will strictly follow the procedures, rules and regulations for competitive tender for PPP, and that the Department of Transportation and Communications will uphold the principles of prudence, transparency and accountability.
“I am confident it will be competitive and will bring about the best advantage for the government,” Villarete added.
The feasibility study, assisted by Korean International Cooperation Agency (KOICA), was completed in October last year.
Neda’s Transaction Advisory Services has yet to finalize the Business Case and PPP Structure. Once approved, both will be submitted to the NEDA-Investment Coordinating Committee (ICC) for approval under the PPP process.
“We’re looking at end of September or October for NEDA-ICC deliberation. After ICC approval, the tender procedure will follow under existing rules and regulations. All in all, we are looking at a PPP award by third or fourth quarter of next year, depending on how long the winning concessionaire can achieve financial close. They will be the ones who will design and construct the new terminal, which maybe completed and opened end of 2015 or early 2016,” Villarete said.
Why wait?
Earlier this year, passengers complained about the extreme heat in the Mactan Airport’s pre-departure areas because their aging air conditioning units could not handle the large summer crowds.
Last week, water flowed out of a floor drain in the domestic arrival hall’s baggage claim area, because the plumbing system couldn’t contain the unusually large volume of rainwater.
“We don’t want to reach the point just like what happened in Manila where new flights are no longer accepted during the day or that airlines are even asked to decrease their flights. Do we want this to happen in Cebu? It will, if we don’t do this fast,” Villarete said.
The government is expected to announce the bidding for the Mactan Airport project before the end of the year. Both parties will then enter into a definitive agreement once the bid rules or the terms or reference for the project have been finalized and published, the Aboitiz-Ayala statement said.
They are also open to forming a consortium with global airport operators.
Aboitiz Equity Ventures declared a consolidated net income of P11.81 billion as of June 30 this year. It told the Philippine Stock Exchange (PSE) that this represented a 16 percent increase year on year.
Ayala Corp., for its part, told the PSE its consolidated net income for the first half was P6.1 billion, or about 23 percent higher than in the same period in 2011. (EOB/With LCR of Sun.Star Cebu)

Published in the Sun.Star Cebu newspaper on September 10, 2012.

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