Property giant SM Prime Holdings, Inc. has completed payment for a 30-hectare property in the South Road Properties (SRP).
Cebu City Treasurer Diwa Cuevas said she received P85 million as final payment from SM last January 14.
“After they completed their payment, the next thing to do is to turn over the title of the property to SM. But we still haven’t scheduled the turnover yet,” she said yesterday.
Cuevas said the money will be deposited to the city’s general fund and will form part of the sources of funds for the city’s P6.4-billion annual budget this year.
The P2.7-billion property is the site of SM Seaside City Cebu, which opened in November last year.
SM started paying for the property in 2010. Payments are made every 14th of the month after a quarter of the year.
SM Seaside City Cebu is the third biggest mall in the country after Megamall and North Edsa.
Joel Mari Yu, former managing director of the defunct Cebu Investment Promotions Center (CIPC) said the city government should use the proceeds from the sale of SRP lots to further develop the area.
“We’re sitting on a gold mine there. It is very obvious. SRP is an unfinished project. There are still a lot of it that hasn’t been sold. If the SRP is improved, it would be very easy for the value to go up,” he said in a press conference he called last week.
He said the P8.345-billion downpayment from the recent sale of the two lots in the SRP last year should be used to improve the SRP by, among others, reclaiming the 60-hectare Pond A.
He said the standard cost of reclaiming is around P5,000 per square meter. To reclaim Pond A, the city would need around P3 billion.
But once it’s already reclaimed, Yu said the value of the lot can increase to P60,000, P80,000 or P100,000 per square meter.
At this amount, he said the city can generate around P22 billion to P40 billion minus the cost for the reclamation of Pond A already.
Yu said pre-terminating the SRP loan, and using the SRP proceeds for it, is not the best thing to do at the moment.
“Paying off debt is a very good sound bite. I do not disagree. The question is whether it is the best thing to do. I will tell you, it is not,” he said.
He said the SRP, not existing developments like the IT Park or the Cebu Business Park, is the economic future for Cebu.