Retirement fund Social Security System (SSS) plans to sell a piece
of property given to it as payment in kind of Bonifacio Land Corp.
The 8,300 sq.m. property near McKinley Parkway and known as Block 56, will be sold for at least P2.24 billion.
The BGC property is the first of a number of real estate assets worth
P20 billion that SSS intends to sell this year. These are properties
SSS was paid with instead of cash for monies borrowed from the
retirement fund.
SSS president Emilio de Quiros Jr said this floor price is 163
percent more than the property’s dacion en pago (payment in kind)
value.
It is between the 10th and 11th avenues and near commercial areas
like the Market! Market!, Bonifacio High Street, and the newly-opened SM
Aura. “This is the most opportune time to sell, while land prices are
at peak levels. Also, the ongoing developments in the BGC created a high
demand for land where there’s a short supply of sellers. So this sale
offers a great opportunity for interested property developers to acquire
a substantial block in the area,” De Quiros said.
The property carries an accommodation value of P29,988 per sq.m., the
SSS said, as the property can be developed to generate a total gross
floor areas of 74,700 sq.m., based on a floor area ratio of 9.
De Quiros said the sale would be made through public bidding to
attract both domestic and foreign investors and unlock the best value
for the property.
“We are optimistic to get the best offer for this prime property. It
is strategically located at the heart of growing business markets and
financial activities,” De Quiros said.
De Quiros also noted the country’s improving political and investment
climate will offer enormous growth potential for enterprises especially
those in real estate, business process outsourcing and tourism.
“The overall business climate is becoming increasingly attractive to
investors. With the recent credit-rating upgrade, we see more companies
establishing their businesses particularly in these areas, where there
are active developments,” he said.
“Not only can they help spur the economy once they develop the
property, but any business that will be put up there will surely result
in new employment. And as more jobs become available, SSS covers more
employees,” he added.
The pre-bidding conference is slated on July 22, while the submission of bids is scheduled on September 4.
De Quiros said SSS plans to complete the sale by October.
De Quiros said they are still determining how to go about with the
other properties they have. The SSS is also eyeing joint-venture
arrangements in developing some of the properties.
The sale would be a boost to SSS’ gross revenues which is targeted
to hit P30 billion this year. So far, it has realized at least P8
billion after it sold investments in the stock market in the first four
months of the year.
Ed Solilapsis, SSS vice president for investment, said the retirement
fund has been a “net seller” of stocks in the first five months of the
year as they saw opportunities to realize gains in this year’s run up
of company shares in the market.
Solilapsis said that for the remainder of the year, SSS may opt to
buy more than sell as the recent drop in shares made many stocks
attractive for picking.
Solilapsis said the fund still has elbow room to increase holdings in
the equities market as it is allowed to pour in as much as 30 percent
of its P350 billion investible fund to the equities market.
Among the fund’s preferred stocks are those exposed to banking and
finance, power generation and distribution, utilities and
infrastructure, telecommunications, and mining.
SSS is currently reviewing the actuarial life of fund which when reviewed in 2007 was found to run up to 2039, De Quiros said.
Last year, the actuarial life of the fund was boosted by a P9-
billion proceeds from member contribution and a P30 billion profit from
investments, said Solilapsis.
source: Malaya
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