Gov’t eyes comm’l dev’t in subway stations

The government is eyeing the commercial development of the areas surrounding the stations of the Metro Manila Subway System to generate revenues and help pay off the money borrowed for the project.

Once developed into retail spaces, Finance Secretary Carlos Dominguez III said the areas around the stations would be leased to businesses and establishments, the proceeds of which would be used to pay off the loans extended by Japan International Cooperation Agency (JICA).

Dominguez said the retail concept is similar to Japan’s underground shopping establishments, in which shops and restaurants thrive around subway stations.

“We’re planning to have retail spaces just like in Japan. We will be utilizing that so we are going to be putting value to the underground area in Manila,” Dominguez said.

“And the revenues will definitely contribute to paying off this loan. Although, I must say the loan is really almost too good to believe because it’s 40 years with a 12-year grace period. Something that, you know, this is very generous package from the JICA,” he added.

To recall, JICA has extended a 104.53 billion yen loan (approximately P51 billion) to the Philippines. Dominguez said this is only the first tranche of the total loan financing requirement for the construction of the Metro Manila Subway Project (Phase 1).

Dominguez and JICA chief representative Yoshio Wada signed the loan agreement last March 16.

The loan carries an interest rate of 0.10 percent per annum for non-consulting services and 0.01 percent per annum for consulting services, payable in 40 years inclusive of a 12-year grace period.

According to the Department of Transportation (DOTr), it has made a deliberate effort to position the stations of the subway beside or near state property to maximize the investment returns for the government.

Transportation Undersecretary for Railways Timothy John Batan identified the proposed North Avenue station, contiguous to the Veterans Memorial Medical Center; the Katipunan station within Camp Aguinaldo property; a station at the Bonifacio Global City beside a property of the Bases Conversion and Development Authority; and a station near the Air Force field at the Villamor Air Base.

“One of the instructions of Secretary Arthur Tugade when we were finalizing the location of the subway project is to bring the stations as close as possible, if not on, government property. This is in connection with a strategy that we have been following of trying to capture value from this investment,” Batan said.