AS a result of the sale of lots to SM Prime Holdings Inc., the Cebu City Government will increase by 100 percent the selling price of the remaining South Road Properties (SRP) lots, which may take effect this month.
Mayor Tomas Osmeña said yesterday he will recommend to the City Council to increase the lot prices because the value of the property is expected to double once SM Prime starts construction later this year.
He said this is also the City’s way of protecting SM Prime’s investment since it will not be easy for the competition to come in.
Now that the City is P677 million richer, he promised that the down payment will be used as “equalizer” funds for north district barangays that did not get as many projects as those in the south.
Part of the payment will also be used to expand and renovate the Saint Anthony Mother and Child Hospital in the south district and to increase the City’s financial assistance to the Emergency Rescue Unit Foundation (Eruf).
From P3 million a year, Osmeña intends to increase the City’s financial assistance to Eruf to P6 million to P8 million.
“We now have money to fund the third supplemental budget. It’s going to be an equalizer fund to balance what the north and south district barangays got because some barangays feel they got less than the others,” he said.
In his speech during the signing of the deed of conditional sale of the SRP lots yesterday, the mayor said that SRP lot prices will double and the increase will take effect soon.
“The development and purchase of SM of the property will immediately mean a few things that would be very significant to the City because I will recommend to the City Council that the prices of our remaining property in the SRP will now be double... because that is precisely what’s going to happen when you see the development of SM going up,” said Osmeña.
Once approved by the council, interior lots that cost P8,000 per square meter will now be sold at P16,000 per square meter and those located along the road will go up from P11,000 per square meter to P15,000 per square meter.
“This is also our way of protecting the initial investment of SM and we are here to see to it that you made the right decision,” the mayor said.
He said the City will not be selling any more lots after the SM deal because the City will have enough to pay for the loan obligations for the SRP.
But if the buyers are willing to buy the lots at double the price, the City will entertain their offers.
The City has a pending offer from Bigfoot Properties to buy a 4.6-hectare area at the SRP and Osmeña said he could wait to close the deal before the City increases the prices of the lots.
“Bigfoot has a favored status because they’re entering into a new type of industry that has a tremendous potential. Money is not important anymore... we’re looking for economic growth and Bigfoot is one of the willing partners who is willing to gamble in the movie industry. We can wait until their offer is accepted and then we’ll double the prices,” he added.