Filinvest Land Inc., the real estate unit of the Gotianun family, rescinded an agreement to acquire a 19.2-hectare reclaimed lot in South Road Properties in Cebu, which it won in June 2015 through a public bidding.
Filinvest Land said in a disclosure to the stock exchange it decided to void the deal after the local government of Cebu City “failed to comply with several covenants, undertakings and obligations that was required to fulfill for more than a year ago.”
The company said while ample extensions were given to the Cebu City government, it did not appear that the city would be able to comply within a foreseeable reasonable period of time.
This prompted the company not to push through with the acquisition pursuant to a provision of the sale document.
Filinvest Land said Cebu City officials and Filinvest representatives would work out the details and the processes to consummate the rescission after Mayor Tomas Osmeña interposed no objection to a letter sent by Filinvest.
Filinvest said despite the development, it would continue to pursue other real estate developments in Cebu, including the 40-hectare City di Mare, a joint venture with the city government.
The Filinvest Group has existing and planned developments in Cebu covering residential, commercial, hospitality and office buildings with investment value of over P20 billion.
Filinvest Land along with office development subsidiary, Cyberzone Properties Inc. and central business district affiliate Filinvest Alabang Inc. bagged the 19.2-hectare SRP property at an offer price of P6.8 billion in 2015.
The property is intended for commercial, office and residential developments.
The 19.2-hectare SRP property was one of the two lots auctioned by Cebu City in June 2015.
The other lot, a 26.5-hectare property was jointly acquired by SM Prime Holdings Inc. and Ayala Land Inc.
Share price of Filinvest Land dropped 1.7 percent to P1.77 Monday.