MAKATI, Philippines — Philippine Infradev Holdings Inc. (formerly IRC Properties) has received the official notice to proceed from the Makati City government for its planned Makati subway project.
To be known as MkTr, the $3.5 billion, 10-kilometer railway system is touted as the biggest public-private partnership undertaking for a local government unit.
In a disclosure Thursday, Philippine Infradev said its subsidiary Makati City Subway Inc. (MCSI) signed an investment agreement with HK Binjiang.
Under the transaction, HK Binjiang acquired a 35 percent direct investment in MCSI by purchasing 15 million common shares for $30 million, payable within 10 business days from effectivity of the agreement.
HK Binjiang will also subscribe 36 million primary common shares of MCSI for a total subscription price of $72 million.
MCSI, on the other hand, obtained board approval and executed a transit oriented development (TOD) agreement with HK Binjiang.
The agreement will ensure availability of funds required to complete the construction of the Makati subway as well as support the operation and maintenance cost of the underground rail system.
Proceeds will come from the topside development of approximately 17.87 hectares of land required for the project.
MSCI, HK Binjiang and Aggregate Business Group (ABG) Holdings Inc. agreed to incorporate Makati Redco Transit Development Corp. (MRTD) which would develop 17.87 hectares of Makati properties and 10 hectares of acquired land for the Makati subway project.
Infradev president Antonio Tiu said “the Makati subway project is envisioned to be completed by 2025 despite slight delays in the arrival of the tunnel boring machines from China as a result of the novel coronavirus outbreak.”
The proposed subway would connect key points in Makati like the central business district along Ayala Avenue, the Makati City Hall, the Poblacion Heritage Site, the University of Makati, Ospital ng Makati and the other new districts in the city.