The Makati City Government has officially awarded listed real estate firm IRC Properties Inc. the permit to establish and operate a subway system in the city, the company said in a disclosure to the Philippine Stock Exchange (PSE) on Tuesday, October 23.
“The company confirms that it has received today from Public-Private Partnership (PPP) Selection Committee of Makati City Government a Notice of Award for the construction and operation of the Makati Subway to be implemented through a joint venture agreement,” the IRC said in the disclosure.
IRC Properties was responding to the clarification sought by the PSE over news report in The Philippine Star on Monday, October 22, quoting the company’s chairman Antonio Tiu saying “November or December should be the right time to do a ceremonial groundbreaking.”
The company did not officially confirm the timetable for starting construction of the project mentioned in the news report.
The award comes seven months ahead of the May 2019 polls that will see incumbent Makati City Mayor Abigail Binay face an electoral challenge from her younger brother Jejomar Erwin “Junjun” Binay, the city’s former mayor who was dismissed by the Office of the Ombudsman over allegations of irregularities in the construction of a city-owned parking building in October 2015. However, the Court of Appeals overturned the Ombudsman’s order in May 2018.
It remains to be seen how the younger Binay’s decision to challenge his sister for the mayoralty post will affect the timetable for the implementation of Makati City’s biggest infrastructure project.
In May, the IRC sent its unsolicited proposal to the Makati City Government to construct and operate an 11-kilometer subway with eight to 10 stations that will serve the two districts of the city, from the Makati City Hall to the central business district in Ayala Avenue. The project would reportedly cost $3.7 billion to build, with no financing needed from the local government.
Previous news reports said the project has since attracted Chinese companies such as Greenland Holdings Group, Jiangsu Provincial Construction Group Co. Ltd., Holdings Ltd. and China Harbour Engineering Company Ltd.
The subway project also seeks to complement the current and planned mass transportation projects of the government such as the Metro Rail Transit Line 3, Pasig River Ferry and the Metro Manila Mega Subway.
According to the IRC, the Makati subway could accommodate up to 700,000 passengers a day. That’s almost twice the projected number of passengers in the first year of the much bigger Metro Manila Subway project costing a total of $7.1 billion.
The subway would be the private real estate firm’s first government infrastructure project as it has been primarily involved in the acquisition, reclamation, development or exploitation of land, forests, minerals, oil, gas and other resources. Its main asset is a 2,200-hectare property in Binangonan, Rizal that it aims to develop into a residential project.
In June, the company increased its authorized capital stock from Php1.5 billion to Php10.5 billion to “finance the expansion of its current and future projects.”
Based on its disclosures to the stock exchange early this year, the company has been undergoing restructuring. In April, the company elected new members of the board with a new president and chief executive officer.
Elyssa Christine Lopez is a staff writer of Entrepreneur.com.ph.