Coral Reef Resort company operators Japanese-led Palm Tree Estate Inc., and Bell Air Golf and Country Club accused the Lucio Tan-led PNB of an illegal foreclosure of the property.
"The terms of conditions were changed after the loan was constituted," legal counsel Judge Romulo Senining said in a press conference.
The company was able to secure a loan from PNB in 1997 of P340 million, and second loan of P80 million, for the development of the resort's expansion to build condominiums and an exclusive golf club.
The construction of the expansion project started in 1994. The company was granted the loan three years later while the economic crisis hit the Asian region, affecting badly the Philippine economy. PNB reportedly released the loans in tranches, which crippled the company's ongoing project that time.
"We had to close the resort's operation and stop the ongoing construction because of lack of funds in 2001," said Palm Tree Estate Inc. and Bell Air Golf and Country Club chairman of the board Kenichi Akimoto.
Senining said the company will fight to nullify the real estate mortgage, saying the bank had changed the loan agreement including the interest and foreign exchange rate after the loan was granted.
The Palm Tree Estates Inc., and Bell Air Golf Country Club is asking the Regional Trial Court (RTC) in Lapu-Lapu City to cancel the title issued already in favor of PNB in September of last year, Senining added.
According to Akimoto he and his partners are still very interested with the property, as they wanted to pursue the development of the Resort, Condominium and Golf Club projects.
He said it's a waste that the property is sleeping and idle in the last five years, and that it means significant losses for the company already.
The Coral Reef Resort started operation in 1989 Akimoto said the company had invested about US$20 million to US$30 million for the entire development of the 50-room high-end resort.
On the other hand, in an earlier interview with Department of Tourism (DOT) secretary Joseph Ace Durano, he said a China-based group is now clenching deal with the PNB to buy the idle Coral Reef Resort property.
Durano said the Chinese group is planning to build a medium rise hotel and resort development with convention center, and develop the 9-hole golf course of Coral Reef.
He said the initial plan of the interested Chinese buyers, whose company he refused to divulge, is to build 1,000 rooms, sensing the big shortage of room in Cebu.
However, the Cebuano DOT chief added that the negotiation may take a little longer, as there are still a number of internal problems that need to be ironed out, although the buyer and PNB had already agreed the price.
But Akimoto reiterated that his company will fight to get the property back.
The Mactan Island is now the center of investment interest of capitalists both foreign and local, as Cebu has long been suffering from resort room shortage.