CENORE Corp. rejected on Friday, March 8, the new lease terms of the Mandaue City Government and decided to direct the hotel management operator of Big Hotel to close the hotel effective June 2019.
“Cenore rejects any move to introduce new terms, any business for that matter, since that will definitely impact business projection when the company invested for the particular project,” Cenore Corp. lawyer Deolito Alvarez said.
Cenore president Roderick Ngo wrote Mandaue City Mayor Luigi Quisumbing that the Cenore board “has nothing to put on the table for discussion regarding the new lease terms that the City of Mandaue has demanded on the Contract of Lease of Lot 1-K-B-3 (the lot Big Hotel is standing).” The City Government ordered the closure of Big Hotel and Big Hotel Suites and Linear Coffee Shop on Feb. 27 for their failure to secure business permits and for building on land under a deed of assignment said to be infirm.
The closure order issued on Feb. 27 was not implemented on Big Hotel and instead, the City gave the hotel operator until March 4 to submit a new lease offer or face closure.
The Cenore board decided on Thursday, March 7, to direct the hotel management operator, Travelbee Management Corp., to close the operation of the Big Hotel three months from today.
Cenore informed the City Government that in three months Travelbee will do the following:
• Arrange the 30 days required filing of notice and submission of pertinent compliance requirements of the Department of Labor and Employment (Dole) to cease operations;
• Give 30 days prior notice under the Labor Code to its 300 employees and workers;
• Give 30 days to prepare the amount for separation pay of employees and workers;
• Arrange payment of suppliers, utilities and other payables;
• Negotiate and arrange for realignment of loans with banks.
“Cenore believes that the bleeding from Travelbee’s hotel operations of Big Hotel has to be stopped, taking into account the cancellations of hotel bookings, programs and events and recorded daily loss of P3 million caused by the notice of closure and the news about the hotel closure,” Ngo said in his letter to Quisumbing.
Ngo maintained that the contract of lease with the City of Mandaue was legal and valid.
“It is both legally binding and morally upright that Cenore will defend this matter when the day comes that this will rest in the appropriate forum,” he said.
Alvarez said that in defending the legal contract entered into by Cenore on the questioned property, they might go to the property courts or judicial body to seek relief.
“It is just sad for a legal business to be caught in political disputes. I have many clients, businessmen, who are caught in the same situation, victims of abuse of power,” Alvarez said.
Quisumbing’s executive staff, lawyer Elaine Bathan, in a statement said: “We are surprised by the decision of Cenore Corp. to close Big Hotel and to end its use of the lot and warehouse as conveyed by its letter that we received today.”
“While our aim was to correct the illegal deed of assignment as mandated by the Commission on Audit. Clearly, Cenore has chosen not to disregard it. Nonetheless, we respect their decision,” Bathan said.
The city will now repossess the lot and the warehouse and extend whatever assistance to the hotel for a smooth turnover.
Both Cenore and Big Hotel are also enjoined to respect the orders previously issued to them pending the turnover.
The Commission on Audit had asked the City to act on the alleged defective process in the assignment of lease from the original lessee, Katumanan Hardware Inc. (KHI), to Cenore Corp. which owns Big Hotel.
The questioned property has been leased out for P12/square meter or P170,000/month to KHI, a private supplier of wood and hardware materials in Cebu, since 2007.
In 2013, KHI signed a contract with Cenore Corp., which runs Big Hotel, subletting the property for commercial development.
In 2018, City Hall cancelled the lease of contract with KHI, which is the reason the three establishments could not renew their business permits.