Property developers snub FTI auction

MANILA, Philippines - Private property developers snubbed yesterday’s public auction for the government’s P13-billion Food Terminals Inc. (FTI) property in Taguig, resulting in a failure of bidding.

The move is seen to leave a huge dent on state coffers as the government is counting on proceeds from the sale of the FTI property to help plug its widening budget deficit which is expected to reach P250 billion this year.

The Privatization Management Office said four property developers attended the pre-bid conference. However, at 3 p.m., the deadline for the submission of offers, the bid boxes remained empty.

“We therefore declare a failure of bidding,” said Felipe Gella, PMO deputy privatization officer.

Four developers including Ayala Land Inc. and the Gokongweis’ Robinsons Land Corp. earlier expressed interest in vying for the FTI property.

Representatives of Ayala Land showed up but did not submit their bids. No other bidders attended yesterday’s event.

Following the failure of bidding, Gella said the government may opt for a negotiated sale.

This, he said, would depend on the decision of the interagency Privatization Council.

Finance Undersecretary Crisanta Legaspi said the council, chaired by the Finance department, would have to wait for the report to be submitted by the PMO on yesterday’s bidding.

She confirmed nonetheless that the government can resort to a negotiated sale with interested parties after only one failed bidding.

FTI is a 120-hectare agro-industrial commercial estate in Taguig. It was originally built to be a food processing and consolidation center for agricultural products. It houses more than 300 small-to-medium scale companies engaged in different industries such as manufacturing, garments and electronics.

Of the 120-hectare property, the government is selling 103 hectares because the remaining 17 hectares are owned by the National Food Authority (NFA).

Market sources said yesterday’s bidding failed because property developers want the government to lower the price to below P10 billion.

Sources said the P13-billion floor price for the property was “too high.”

Earlier, the Government Service Insurance System (GSIS), said it was offering P7 billion for the property.

However, for the government, the P13 billion is reasonable because based on the last valuation of the property, FTI had a sale value of roughly P15 billion.