Revised contract for SRP joint venture seen

A revised contract will be submitted to the Cebu City Council next week to fast-track approval of the joint-venture agreement (JVA) for the development of the eight-hectare Kawit Property in the South Road Properties (SRP).

This came after the council’s ad-hoc committee laid down 20 conditions for the approval of a resolution that will seal the deal between the city and Universal Hotels and Resorts Inc. (UHRI).

In last Friday’s press conference, Cebu City Mayor Tomas Osmeña said he has yet to read the ad hoc committee report.

“Let me just read everything but I don’t think there’s anything serious (that needs to be modified). Let’s see what (recommendations) we can accommodate. I’ll be submitting the contract (maybe next week or) as soon as possible,” said Osmeña.

The ad-hoc committee, formed last March, is tasked to scrutinize the JVA between the Cebu City government and the Gokongwei-led UHRI.

Councilor Raymond Garcia, an adhoc committee member, clarified that the amendments don’t mean that the deal will be put on hold and cause delays on the proposal.

Among the amendments were the reduction of the development period from nine to eight years, and for the contract to undergo mutual negotiation, instead of an automatic renewal after the 50-year lease expires.

The Cebu City government is also asked to specifically state in the contract that the proponent shall pay real property taxes for both land and buildings to be built in the area and that the city maintains exclusive rights to reclaim the land.

“The committee found that a lot of provisions had to be amended. More than 10 provisions had to be amended. We returned (the contract) to the executive to tell them that these are the recommendations to be done,” he explained in Cebuano.

Once the revised contract is submitted, it will undergo a Swiss Challenge in which third parties are invited to match or offer a better proposal to the unsolicited proposals that a private entity submitted to a government agency.

“If there’s a new contract, then it will definitely have to go through a process of Swiss Challenge. It’s a new agreement. And it’s not to delay the proposal,” Garcia said.