Wall dispute over soon

IT park wall

The row between two giant real estate developers over free access to a new BPO complex next to the Cebu I.T. Park may be over soon.

Finishing touches are being put on an agreement that will see the peaceful demolition of the wall separating the property between both competitors.

On Monday, the Cebu Provincial Board (PB) will hold a special session to approve a resolution authorizing Cebu Gov. Hilario Davide III to enter into a Memorandum of Agreement (MOA) with Filinvest Land Inc. and the Ayala-led Cebu Property Ventures and Development Corp. (CPVDC) which operates the I.T. Park.

The draft MOA signals a breakthrough in mediation talks.

Once the agreement is signed by the parties, said Vice Gov. Agnes Magpale, the perimeter wall along W. Geonzon Street that blocks the front lobby  and driveway of the new BPO complex of Filinvest will be voluntarily torn down.

And the Filinvest Cebu Cyberzone will become one of the “locators” in the well-established business park, she said.

“This is now the solution to the problem. All that we have agreed upon with both companies is contained in this MOA,” Magpale told Cebu Daily News.

“That’s why we said from the start  that there was no need for a court battle.”

The P5-billion BPO complex, a joint venture with the Cebu provincial government  inaugurated its first tower  last Nov.  28 after suffering delays in completion over an unresolved issue of access that would require punching through an old concrete wall in the boundary of the I.T. Park.

Although the Cebu Cyberzone has access on Salinas Drive, Filinvest built its main facade facing W. Geonzon Street, a private road inside the I.T. Park.

Threats by Cebu City Mayor Michael Rama to tear down the wall, after declaring it illegal and a nuisance, strained relations with Ayala developers of the I.T. Park, and led to the filing of a petition for injunction last October to stop any demolition.

Behind the scenes, conciliation talks continued with Capitol officials meeting separately with Filinvest and CPVDC officials.

TWO RESOLUTIONS

A solution is  about to be sealed, if all goes well.

The PB decided to convene in the middle of the Christmas holidays  to approve two resolutions  to lay the groundwork “as soon as possible” said Cebu Vice Gov. Agnes Magpale.  The board previously held its “last” regular session of the year on Dec. 15.

Two resolutions are being sponsored by PB Member Peter John Calderon.

One authorizes Governor Davide to represent the Cebu provincial government in a MOA with Filinvest and the other one, the same authority to sign a MOA with CPVDC.

Details of the MOA were not immediately available.  Magpale said they will provide copies during Monday’s session.

“It is so thick compared to the usual MOAs we have. It is very comprehensive. All issues have been addressed,” she said.

The three parties, with the Capitol acting as mediator, have been meeting regularly for the past few months with the aim of reaching a mutually-beneficial resolution to the dispute.

Jeanette Japson, corporate communications manager of Cebu Holdings Inc. yesterday confirmed that they are in the final stages of drafting the MOA.

She declined to discuss its contents until it is completed.

Asked if the agreement can be sealed before the year ends, Japson said she “cannot tell” considering the number of working days left before the start of 2015.

“There are only a few working days left in the year so I really cannot tell. But the MOA is almost finished. There are just a few things we need to complete,” she told CDN yesterday.

“Maybe they (the Cebu provincial government) are just asking for (PB) authorization early,” she added.

 

PERPETUAL ACCESS

In exchange for CPVDC’s commitment to “open the wall,” Vice Governor Magpale said the province is granting the Ayala-led real estate company “perpetual access” to a “small road” owned by the province along Salinas Drive in front of the Cebu I.T Park.

The opening of the road, she said, was seen as one of the measures to decongest vehicular traffic in the  I.T. Park in the event that the property is opened to the Filinvest’s Cyberzone complex.

The I.T. Park is located on the old Lahug airport, land owned by the Province of Cebu until it was disposed in the 1990s to raise P1 billion in a bond floatation during the term of then Gov. Emilio R. Osmeña.

Cebu province currently is a minority share holder in CPVDC but still owns strategic small parcels in the frontage of the I.T. Park.

At times, the Capitol opens the  strip to food stalls which rent it at certain periods. At present, the area is vacant and unused.

“The province was eying that strip for future road expansion in the area. But CPVDC requested to  use it to help ease up  traffic inside. We said yes,” said Magpale.

PB Member Sanchez said they worked double time to fulfill a  promise to come up with a “win-win” agreement between the province and the two real estate companies before 2014 ends.

“This was also what the governor wanted,” she said.

“It follows nga gub-on na gyud na ang wall. (The wall will be demolished). Actually, that has long been agreed upon. What took us long to finish it were the requirements of both sides,” said Sanchez in an earlier interview.

Governor Davide, during the inauguration of the Filinvest Cyberzone, said it would be a good “Christmas gift” to the public to end the dispute so the BPO complex could start operations.

Sanchez ,who chairs the PB committee on municipal and provincial properties, Provincial Administrator Mark Tolentino and Magpale have been presiding over the with CPVDC and Filinvest since the middle of the year.

Cebu province is connected with both companies.

It is a minority shareholder in CPVDC as the original owner of the land that is now the I.T. Park.

It is also Filinvest’s partner in the BPO project under a Build-Transfer-Operate Scheme following a public bidding held in 2012 during the term of former governor Gwen Garcia.

The original construction timetable in the MOA between Cebu province and Filinvest was to finish the project in May 2013.

The bidding documents referred to the development and use of the 1.2 hectare province-owned lot located in Salinas Drive in barangay Lahug.

But a condition was added in the MOA for the Province “to ensure that Filinvest shall have an unconditional right or access and passage through W. Geonzon Street.”

The dispute over access heightened last October when a court suit was filed by CPVDC and  locators in the I.T. Park who form the Asiatown I.T. Park Association Inc.

President Francis Monera and  Nerissa Josef filed a petition seeking an injunction order to stop any demolition of the wall on W. Geonzon Street following threats by the Cebu city government to tear it down.

Named defendants in the petition were the City of Cebu; Megawide Construction Corp.,  Filinvest,  Engr. Nazareno Abalos as project manager of Filinvest’s Cebu Cyberzone Project; and Allan G. Alfon, Filinvest vice president for strategic business planning Vismin.

Cebu City Regional Trial Court (RTC) Executive Judge Soliver Peras issued a 72-hour temporary restraining order on the planned demolition which he later extended to 20 days.

Last Dec. 12, he issued a preliminary injunction, saying Filinvest and Cebu City raised a “hollow argument”  that the court can’t stop a government project.

The judge said CPVCDC was merely acting to protect its property and not to interefere in the business or construction of the Cebu Cyberzone.

However, the preliminary injunction will be “moot and academic” when the two parties sign the MOA, said PB Member Sanchez.

The Filinvest Cyberzone building was inaugurated last Nov. 28 but can’t fully open because the disputed wall is in front of the building’s main lobby and driveway, including retail shops on the ground floor.

The province is set to earn P500,000 every month from the rental or two percent share from the gross revenue generated from the locators, whichever is higher.

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