State-run pension fund Government Service Insurance System plans to raise as much as P37 billion from the sale of more than 78 hectares of non-performing assets in Port Area, Manila amid the increase in zonal value of these properties, the fund’s top executive said Tuesday.
The sale could raise more than P37 billion based on the latest zonal value of the properties in Manila. GSIS manages the pension fund of government employees.
“We offered it to sell before, but we pulled out because the zonal valuation was not updated,” GSIS president and general manager Jesus Clint Aranas said in a news briefing at the agency’s headquarters in Pasay City.
Aranas said the pension fund would want “to sell the assets as soon as possible.” He said he was going to talk to the board regarding the sale.
Aranas said the Port Area assets spanning 781,857 square meters include commercial and industrial lots covering 672,645 square meters and residential areas measuring 109,212 square meters.
The zonal valuation of the Port Area properties in 2018 reached P25.56 billion for the commercial/industrial properties and P412.82 million for residential, based on the Bureau of Internal Revenue’s website.
The May 2019 zonal valuation of the BIR, however, showed that the commercial/industrial areas were valued at P33.63 billion, the residential areas at P3.82 billion.
“We are selling these properties as is, where is,” Aranas said.
The valuation reforms in the real property tax system constitute Package 3 of the Duterte administration’s comprehensive tax reform program.
Finance Secretary Carlos Dominguez III earlier said these reforms would further invigorate the real estate market, bring in more investments and generate additional revenues for local government units.
Aranas said the new income of GSIS quadrupled in the first quarter to P38.7 billion from P9.05 billion a year ago. The increase was driven by the rise in stock market values, higher interest income and larger premium contributions.
Contributing to this increase was GSIS’s public equities portfolio which accounted for about 20 percent of total assets, as the Philippine Stock Exchange index climbed 6 percent to 7,920.93 in the first quarter.
Total assets also rose by 6 percent or P74 billion to hit P1.2 trillion as of end-March 2019.