Filinvest commits to pay P224M for SRP lot this week
Tristan Las Marias
Filinvest Land Inc. (FLI) will pay P224 million to the Cebu City government this week as their second to the last payment for the 10-hectare pond F of the South Road Properties (SRP) which they bought in 2009.
Tristan las Marias, Filinvest first vice president for Visayas and Mindanao, said the payment of guarantee fees to the city as part of a joint venture for another 40 hectare SRP lot will be made after both camps reconcile their records on the deal.
He said personnel from the City Treasurer’s Office and Filinvest staff met yesterday to reconcile the records. Filinvest’s payment for their pond F lot purchase is done once a year.
It is computed separate from the guarantee fee or the JV share they pay to Cebu City Hall. The last of their interest bearing amortization for pond F is due on March 2015.
Last Monday, Cebu City Mayor Michael Rama asked Filinvest to settle their due with the city government amounting to P803 million.
GUARANTEE FEE
That amount represents the guarantee fee from the 10-hectare lot that they are now developing at the SRP.
Joint venture proceeds amounting to P1 billion were identified as one of the sources for Cebu City’s 2-14 budget.
Filinvest bought the 10-hectare pond F at P15, 000 per square meters.
Since payment is spread until 2015, Cebu City Hall is expected to earn a total of P1.6 billion from the lot sales plus interest charges.
The real estate company has so far developed 10 hectares out of the 40 hectare lot located across the street from pond F.
GROSS INCOME
Las Marias said under the JV agreement, Filinvest is supposed to pay the city a guarantee fee of at least P1 billion every five years or 10 percent of their gross income as JV share or which ever is higher.
“The guarantee amount is a certain number and it increases by a certain percentage (every due date) based on COA computations,” he told Cebu Daily News.
Payment of their first guarantee fee is due March 2014. The next payment will be due on March 2019 and so on.
Las Marias said March is used as the date of reckoning the computation of the guarantee fee to coincide with the month when the joint venture agreement was also signed.
But unlike the guarantee fee, the joint venture share is computed per quarter.
“The JV share is computed per quarter. I develop. I sell. I give you 10%. If we compute their share after a period of five years and if the amount is less than the P1 billion guarantee fee, I give you more to match the guarantee amount,” Marias explained.
Las Marias said Filinvest issued a check worth P967.68 million which already include their P224 million due for pond F and the balance of their guarantee fee due of about P700 million.
Based on CTO computation, Filinvest owes Cebu City P1.053 billion in guarantee fees.
Las Marias said they already made an initial payment amounting to P309.71 million leaving only an unpaid balance of about P700 million.
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