Government in talks with 3 property firms for FTI's negotiated sale

MANILA, Philippines - The government is in talks with three property developers for a negotiated sale of the P13-billion Food Terminals Inc. (FTI) property in Taguig after failing to sell this in a public bidding last month, Finance Secretary Margarito Teves said yesterday.

Teves said one party is “traditionally a real estate firm” while the two other developers branched out into the property and real estate business. However, he stressed that he cannot identify the groups because of the non-disclosure agreements.

The Finance chief said the government hopes to close a deal with the property firm that can give the best offer before the end of the year to be able to book the proceeds immediately.

Proceeds would help the government contain the budget deficit at P250 billion this year, Teves said.

“We’re still trying to make it before the end of the year. We believe (the sale) will push through but circumstances might change,” Teves said.

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).

Last October, property developers snubbed the actual public bidding for the property held at the government’s Privatization Management Office in Makati.

Four property developers attended the pre-bid conference but nobody submitted an offer.

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

Representatives of Ayala Land showed up during the public bidding but did not submit an offer.

Market sources said the bidding failed because property developers wanted 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), the state-owned pension fund for government employees, said it was offering P7 billion for the property.

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