Ayala Land Inc. and Philippine Estates Corp. of the Gatchalian Group terminated a planned joint venture partnership to develop a 21-hectare property in Valenzuela City known as “Plastic City.”
Ayala Land in a disclosure to the stock exchange said unit Avida Land Corp. along with PHES and units Wellex Industries Inc. mutually agreed to terminate the memorandum of agreement executed by the parties in December 2012.
“PHES and subsidiaries of Wellex have decided to reevaluate its concept and feasibility studies on the property while Avida will focus on its ongoing and other planned projects,” Ayala Land said.
Wellex in 2012 singed an agreement with Avida Land, the middle-income property development arm of Ayala Land, to develop the 21-hectare property in Valenzuela, which forms part of the entire 60-hectare Plastics City.
The plan was to develop the property into a mixed-use residential and retail development over a period of 10 years. Other components of the project include an educational complex and office buildings for business process outsourcing firms.
Plastic City used to house the warehouse facilities of Plastic City Industrial Corp. and Philfoods Inc. until the two companies ceased operations in 2002 due to losses.
Wellex in 2018 said it might pursue the redevelopment of the entire Plastic City after the rehabilitation case against its subsidiaries was terminated and the loans with Philippine National Bank were settled.
Wellex said the termination of the corporate rehabilitation case also enabled its subsidiaries to continue with the agreement with Avida Land.
Once the property is fully developed, Wellex said it would generate cashflows to the subsidiaries involved in the project.
Share price of Ayala Land on Monday rose 3.3 percent to P47 while the stock price of Wellex fell 4.5 percent to P0.213.