A MEMBER of the committee tasked to evaluate the unsolicited proposal for an P18-billion development in the South Road Properties (SRP) wants the proponent to give assurance that they can pursue the project.
During the ad hoc committee’s hearing yesterday, Cebu City Councilor Raymond Garcia said he has concerns on the track record of Universal Hotels and Resorts Inc. (UHRI) because the firm is a newly formed corporation that will be undertaking a huge project for the city.
“I’m very concerned that it’s just a new corporation, and it doesn’t have any track record. It just has a memorandum of cooperation with Robinsons Land Corp. (RLC) which, for me, does not even give RLC an obligation because there was no mention of anything. It’s just for the management of the particular project,” Garcia said.
Both UHRI and RLC belong to the Gokongwei Group of Companies.
In a letter to Mayor Tomas Osmeña, RLC President Frederick Go said that RLC may enter into an arrangement with UHRI to allow the latter to obtain financial assistance as needed in the proposed development. RLC also submitted a certification from BDO that they have a P19-billion approved credit line, which UHRI may use in developing Kawit Island.
UHRI and RLC entered into a memorandum of understanding (MOU) to allow the former to obtain expertise in development, marketing and management of the proposed integrated resort city in the SRP, in what used to be Kawit Island.
As proposed, UHRI’s development will consist of a commercial and shopping center, a theater, a convention center, an integrated resort and gaming facility, three hotels, a theme park, a public art installation, and parking spaces.
Garcia, who is also a lawyer, questioned why RLC is getting six percent of the rental revenues generated from the lease of built-up or leasable space in the project. “It only has a paid-up capitalization of P4 million. I was wondering why don’t you just form a consortium, for example with RLC, so that people you are dealing with will no longer have questions on your capacity. If something goes wrong with the corporation that does not have substantial capital, that will leave the City of Cebu with an empty bag,” he said.
In response, Maybelle Gobio, senior vice president of RLC, said that although UHRI is a new entity, considering that it’s part of the Gokongwei Group of Companies, it has the financial capability to put up the project.