THE plan to revoke the sale of the 45.2-hectare South Road Properties (SRP) lots to three listed developers has to be studied carefully, so as not to scare potential investors, Cebu business leaders yesterday said.

While they have to find out what prompted Cebu City mayor-elect Tomas Osmeña to make such pronouncement, Cebu Chamber of Commerce and Industry (CCCI) president Melanie Ng said they believe the rule of law should prevail.

“If the previous bidding was done in compliance with the rule of law, this should be respected,” said Ng. “Investors who plan to come to Cebu might feel threatened if we do not follow or comply with bidding rules.”

Osmeña on Wednesday announced he will revoke the sale of the property awarded by the Cebu City Government to the consortium of Ayala Land-Cebu Holdings Inc. and SM Prime Holdings Inc. and Filinvest Land Inc. in 2015, calling it “questionable.”

He believes the sale of the SRP lots was anomalous because there was a “monopoly” during the bidding. The developers allegedly agreed on what property to buy.

The three listed companies have yet to issue official statements, as they haven’t received any official notice.

Cebu Business Club president Gordon Alan Joseph recommends that the cancellation of the sales agreements be studied carefully before its implementation.

“If the agreements are cancelled, then it will be fair to assume that investors in Cebu, who also create jobs for the City’s constituents, may act negatively and begin to see Cebu as a more risky place to do business,” said Joseph.

He added this may have an immediate to medium-scale effect on business, saying business investments are all about potential, with a healthy mix confidence and predictability.

“Businesses are averse to contract cancellation risks, particularly where the government-private sector type contracts are concerned,” he noted.

Joseph suggests the City sit down with the affected corporations to iron out a practical way forward that will benefit the constituents of Cebu City.

“Cebu City needs funds for development projects that are going to increase liveability, competitiveness and efficiency and improve the quality of life of its population. I always assumed that these are what the sales proceeds were to be used for,” Joseph said.

Cebu City held a public bidding of 45.2 hectares in June 30 last year.

The consortium of Ayala and SM acquired 26 hectares while 19.2 hectares was acquired by Filinvest.

The companies bought the land for P35,000 to P38,000 per square meter. The sale was closed for P16.76 billion.

In August, the City received the 50 percent down payment from three developers, which amounted to P8.35 billion.

The remaining 50 percent is supposed to be payable in three years, starting this year.