Take the case of Property Company of Friends Inc., or Profriends, which focuses on the affordable to middle-income primary home market, and which while a being relatively a newbie has managed to create a solid name for itself.
According to recent newspaper accounts, Profriends’ land bank now stands at over 1,600 hectares, most of which is in Cavite. It has over 1,400 employees as of July 2015, has completed 17 projects, and has nine ongoing residential projects.
The same reports have revealed that three of its current projects are in Cavite. Lancaster New City, which has a total area of 1,300 hectares located in Imus, Kawit and Gen. Trias, is the company’s biggest development. Bellefort Estates in Bacoor offers homes with a price range of P2.5 million to P5 million, while Carmona Estates has sold over 5,900 housing units. Meanwhile, its Iloilo Estates project in Pavia has a total land area of 170 hectares and is the company’s initial venture outside of Cavite and Metro Manila.
In an industry characterized by cutthroat competition, Profriends has managed to rise above the pack by slowly but steadily building a solid reputation for quality in the affordable to middle income home market.
Profriends growing reputation has not escaped the attention of GT Capital Holdings, the holding company of business tycoon George Ty of the Metrobank Group, which recently acquired a 22.68 percent stake in Profriends worth P7.24 billion and which plans to increase its equity stake to 51 percent in three years.
Profriends has had its share of challenges to its credibility and reliability. However, the company is confident that sticking to its core values—service excellence, professionalism, integrity, innovation, teamwork and a sense of family—will allow it to survive all these challenges.
Such a waste of time
Just recently, we revealed that the Metro Pacific group may take the arbitration route to force government to honor its contractual commitments and grant the much-delayed toll fee adjustments that the group has been seeking and to which it is entitled to under its contract with government.
Metro Pacific Investments Corp. (MPIC) president and CEO Jose Ma. Lim has said that they might initiate arbitration proceedings against the government as a last resort for the latter’s failure or refusal to act on the toll rate adjustment petitions filed by the Manila North Tollways Corp. (MNTC) and the Cavitex Infrastructure Corp. (CIC). MNTC and CIC operate the North Luzon Expressway (NLEX) and the Cavite Expressway (Cavitex), respectively.
In their concession agreements with the government, both MNTC and CIC are entitled to rate increases corresponding to inflation adjustments. MNTC has four years’ worth of inflation adjustments pending for NLEX while CIC has six years of inflation adjustments for Cavitex, equivalent to 19 percent and 23 percent, respectively.
In the case of MNTC, it is simply claiming foregone revenues amounting to P2.4 billion to which it is entitled to under its contract with government.
Unfortunately, the Toll Regulatory Board (TRB) would not hear of it.
MNTC has to adjust toll fees every two years, as provided for in its concession agreement with the government, in order to recoup its multibillion-peso investments and generate enough cash for its road expansion, improvement and maintenance projects for the benefit of motorists and commuters.
CIC, in turn, has to adjust its fees once every three years.
Both MNTC and CIC have warned that their failure to collect the higher rates would result to outright delay or stoppage of needed improvements, expansions or repairs of the toll facilities.
It will not be the first time that the Metro Pacific group will resort to arbitration to force government to honor its contractual commitments.
MPIC subsidiary Maynilad Water Services recently filed a second arbitration case against the Metropolitan Waterworks and Sewerage System (MWSS) before the Singapore-based tribunal of the International Chamber of Commerce (ICC), after MWSS refused to grant Maynilad’s water rate hike petition despite the Dec. 29, 2014 order by the ICC for the government to do so at the end of the first arbitration case between the two parties.
Rather than increase water rates in 2013, MWSS ordered Maynilad and Ayala-owned Manila Water Co. to reduce their rates in violation of the periodic rate-rebasing process stipulated in their 1997 concession agreements.
But these are not the only problems that MPIC is facing. For instance, CIC’s extension project to connect CAVITEX to Circumferential Road 5 (C-5) is gathering dust at the TRB while the Swiss Challenge for MPIC’s NLEX-SLEX Connector Road project is still pending at the Investment Coordinating Council (ICC) and the National Economic and Development Authority (NEDA) Board for unknown reasons.
Meanwhile, MNTC is awaiting the formal award to it of the contract to manage, operate and maintain the Subic-Clark-Tarlac Expressway (SCTEX), eight months after winning the project in a Price Challenge conducted by the Bases Conversion and Development Authority (BCDA). This despite MNTC’s payment of P3.5 billion in cash and its implementation of a P650-million project to integrate SCTEX with NLEX.
Also, the timetable of MPIC’s subsidiary MPCALA Holdings Inc. for its Cavite-Laguna Expressway (Calax) is being threatened also by the government’s non-delivery of the necessary right of way.
If this government is really serious about infrastructure development, then why all these delays which could have been avoided had there been political will on the part of our leaders?
Step in the right direction
Government must be doing something right, gauging from the increase in excise tax collection from so-called “sin products.”
Collections have risen by 18.5 percent from January to August this year compared to the same period last year, according to the Bureau of Internal Revenue. During the first eight months of the year, the tax take reached P77.6 billion from P6.5 billion in 2014. For tobacco products, collections rose 22 percent year-on-year to P5.15 billion while those from alcohol products increased 12.2 percent to P26.1 billion.
Excise tax collections from tobacco and alcohol products rose 27.3 percent, from P9.3 billion in August 2014 to P11.9 billion in August 2015, BIR commissioner Kim Henares said.
Those from cigarettes alone increased to P8.6 billion from P6.6 billion in the same month last year.
According to the BIR, much of the increase is due to the higher rates imposed under the Sin Tax Reform Law.
Under RA 10351, cigarette packs below P11.50 are taxed P21 this year, from P17 last year, while those that cost P11.50 or more are imposed a P28 tax, compared to P27 in 2014.