THE Cebu City Council wants the joint venture selection committee (JVSC) for the P18-billion proposed development of Kawit Island to consider observations and suggestions they made in a report.
In a 14-page report, the committee has asked the JVSC to require the project proponent to comply with four additional conditions, before giving them a notice to proceed.
The conditions, the committee said, will protect the best interest of the City.
First, the committee wants the proponent to give a performance bond representing 10 percent or around P1.8 billion of the total unfinished project cost, which will be valid for eight years since the start of the project.
Universal Hotels and Resorts Inc. (UHRI), a Gokongwei-led corporation, is set to enter into a joint venture agreement with the City Government to convert Kawit Island in the South Road Properties (SRP) into an integrated resort facility.
UHRI’s proposed development will consist of a commercial and shopping center, a theater for performing arts, a convention center, an integrated resort and gaming facility, three hotels, a theme park, a public art installation, and parking facilities.
Under the proposed joint venture agreement, the City will get a 10-percent share from the lease of commercial and shopping areas, hotels and the integrated resort, and 15 percent from the casino’s operations.
The committee also wants UHRI to submit specifications of the P18-billion investment for the horizontal and vertical development of the proposed project.
Third, it said, UHRI should also present a bank guarantee or letter of credit or an approved loan agreement with an amount of at least P18 billion issued under their name.
The corporation is also asked to submit the valuation of leasable spaces of the project by the Land Bank of the Philippines or the Commission on Audit, to determine the value of the City’s contribution.
Earlier, an hoc committee chaired by Councilor Renato Osmeña, with Councilors Margarita Osmeña, Sisinio Andales, Raymond Garcia and Jose Daluz III as members, was formed to study the proposal.
The ad hoc committee conducted several committee hearings to discuss the financial, technical, and legal aspects of the project before the submission of their report last Tuesday.