SM willing to rescind contract
This is a continuation of the issue we wrote last Monday regarding the information I got from a source stating that SM Prime Holdings top executives have decided to cancel the company’s plan to put up a sports arena and a huge convention center at the South Road Properties (SRP) in view of the “harassment” the big three developers that bought a parcel of lot at the SRP during “has-been” mayor Michael Rama’s administration received from the “former political has been.”
According to my source, the company has no intention to fight City Hall. In fact, SM officials are willing to rescind the contract because of the controversy it generated. They are just caught in the political crossfire. But the company cannot do it alone without the concurrence of Ayala Land Inc., it’s partner in the deal.
The firm also sent its representatives to City Hall to ask for the official assessment of the taxes to be imposed against it for the “under-declared” areas at SM Seaside Mall. But nobody provided them with the official records and the corresponding tax assessment.
On the under declaration, the source said it is impossible for the mall’s engineers to deviate from the original plan. City Hall’s Office of the Building Official (OBO) was strictly monitoring the construction to see to it if the contractors followed the original blueprint.
Granting that there were “minor defects,” why was the owner charged and called “cheat” when the defects can be corrected and proper assessment of the land area could be made and the owners obliged to pay the proper taxes? Management had corrected a portion of the mall’s pavement that encroached on the highway when public works and highways officials called its attention.
On Banco de Oro, the source said that its management did not under-declare its income and challenged City Hall to check the bank’s records properly. In the banking industry, branches have limited income. The bulk of the income is in their main branch where loan applications and approval are being processed. Branches only receive deposits, checks and manager’s check encashment with minimal charges.
The bank’s income is not based on number of depositors but on availment of loans. What can banks get from deposits? In fact banks are the ones paying interest.
The SM management is expecting more harassment cases against its business affiliates operating in the city. If City Hall initiates the move to rescind the contract, SM officials and their lawyers are more than willing to work for a “peaceful solution” to the controversy. But with certain conditions because the company, as well as Ayala Land and Filinvest, already made an advance payments of P8 billion.
If SM cancels these multi-billion-peso projects at the SRP, Cebu will lose in terms of investments, revenues and employment. If this happens, blame the present City Hall occupant. Because of his personal and hidden agenda, Cebu is at the losing end. We already know his intention.