Commission Decision No. 05-M-003/2019:
In the Matter of the Proposed Joint Venture among Bases Conversion and Development Authority,
National Housing Authority, and Primelux Holdings Development Inc.

 

[MAO Case No. M-2019-003]

ABSTRACT: 

The transaction involves the proposed joint venture (JV) among Bases Conversion and Development Authority (BCDA),
National Housing Authority (NHA), and Primelux Holdings Development, Inc. (PHDI) with it being a special purpose subsidiary of Shanghai Nanjiang Co. Ltd. (SNCL or Nanjiang Group).

The property subject of Joint Venture Agreement (JVA) is the 59.62-hectare property located along C-5 Road, Fort Bonifacio, Bonifacio Global City, Taguig City, Metro Manila which is now known as the “Bonifacio East Property.”

In the joint venture agreement, Primelux is set to finance project  with a minimum investment commitment of P137 billion spread over 9 years, while BCDA and NHA shall contribute the rights to develop and use the project sites.

In December 2017, BCDA received an unsolicited proposal from SNCL for the financing, planning, design, development, construction, operation and management of the 59.62-hectare Bonifacio East Property and allotting a 9-ha area thereof for on-site relocation of informal settler families (ISFs).  In evaluating the proposal, BCDA and NHA agreed to jointly develop the Bonifacio East Property with BCDA as the implementing agency.

BCDA and NHA then proceeded to conduct the Competitive Challenge on the SNCL’s unsolicited proposal in accordance with the BCDA JV Guidelines but the agencies did not receive any other bid. BCDA and NHA has then awarded in favor of SNCL the right to develop the Bonifacio East Project via joint venture arrangement.

The parties agreed to name the JV as “Bonifacio East Project Joint Venture,” or any other name that may be mutually agreed by the parties on or after the signing date.

In its submissions, the establishment of the JV intends to:
(a) Develop the Property into the Bonifacio East Project;
(b) Promote the economic and social development of the area subject of EO 70, Series of 2002, as amended;
(c) Construct new and improved housing facilities for ISFs within the designated relocation site;
(d) Spur economic growth in the area by providing business opportunities;
(e) Generate employment opportunities in the area; and
(f) Engage in the business of developing, leasing, and operation and maintenance of facilities and improvements in the Bonifacio East Project.

The term of the JVA and JV shall commence after approval by the Philippine Competition Commission (Effective Date) and continue thereafter for a period of 50 years (Expiry Date), and may be extended for another 25 years. The Joint Venture shall terminate on the expiry date unless earlier terminated.

The BCDA is a government instrumentality vested with corporate powers created by Republic Act No. 7227 where it enters into commercial transactions to develop its properties or converts former military reservations and their extensions, portions of Metro Manila camps, former baselands into alternative productive civilian uses.

The NHA, on the other hand, is a government-owned and controlled corporation created by Presidential Decree No. 757 that is mandated to develop and undertake housing development and/or resettlement projects through joint ventures or other arrangements with public and private entities.

Primelux Holdings Development, Inc. is a corporation duly registered in the Philippines. It is the special purpose subsidiary incorporated for the purpose of stepping into the rights and obligations of Shanghai Nanjiang Co. Ltd. (SNCL or Nanjiang Group) in the JV. Primelux is named as the Private Sector Partner of the Nanjiang Group under the JVA.

The Nanjiang Group is an investment conglomerates in mainland China founded in 1993 with more than 1000 employees and approximately 10 billion yuan (PhP80 Billion) worth of assets. The Nanjiang Group is the controlling shareholding of Deluxe Family, a public company listed at the Shanghai Stock Exchange. Its scope of business is diversified covering real estate, new materials, artificial intelligence, bio-medicine and finance. Most of its the commercial and residential projects are located in the Yangtze River Delta, including Sandalwood Private Resort, La Vue and Aqua Vista.

 

Download (Commission-Decision-No.-05-M-003-2019_BCDA-NHA-Primelux_28Feb2019.pdf)