$10B airport project presented to Aquino

Bigger, better than those in HK, Singapore

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04:49 AM May 15th, 2014

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MANILA, Philippines—San Miguel Corp. presented to Malacañang on Wednesday a $10-billion plan to build for the government along the Cyberbay reclamation area a brand-new airport seen to beat the existing international gateways of Hong Kong and Singapore.

SMC president Ramon S. Ang confirmed via text message that the $10-billion airport project was successfully presented and that Aquino was “happy.”

In an interview in his office, Ang showed a scale model of the proposed airport, which would be located along CyberBay Corp.’s disrupted waterfront reclamation project along the Manila-Cavite Coastal Road, covering the cities of Parañaque and Las Piñas.

The proposed airport will have four runways with a length of 3,600 meters each and can accommodate as many as 250 plane take-offs and landings an hour, dwarfing the 40-an-hour capacity of the current Ninoy Aquino International Airport. Four Airbus 380 planes could land on the new airport at the same time, Ang said.

Included in the $10-billion estimated cost was an elevated tollroad that would connect the proposed airport to the Makati central business district, Ang said.

“If they agree to this, it will be a massive infrastructure project beating Hong Kong and Singapore. It will be the best airport in the region,” Ang pointed out, noting that Hong Kong and Singapore had only two runways in their main airports.

The project will make use of the 157 hectares of land already reclaimed by Cyberbay, which is seeking about P11 billion in reimbursements from the Philippine Reclamation Authority for the relocation of informal settlers in the area and funds injected to run the operations of Central Bay from 1995 to 2002. It is strategically located near the Entertainment City of the state-run Philippine Amusement and Gaming Corp. (Pagcor).

While the project would rise on the reclamation project begun by Cyberbay, Ang said the entire airport would need 1,600 hectares and that more reclamation would be done while Cyberbay could have a small stake in the project.

For SMC, Ang said the conglomerate was proposing to build this for the government without owning the airport itself. Upon completion, he said SMC would turn over the airport property to the government and get compensated by operating it.

To unlock values from the 400-hectare old Naia airport, Ang suggested the privatization of the prime property, which he estimated could raise up to $10 billion for the government. “This could be another CBD (central business district),” he said.

Since SMC would not own the property, Ang said it was only proposing this as a contractor for the government. Once the airport is built, SMC will earn from terminal fees as well as fees to be paid by airlines for landing their fleet. The conglomerate will negotiate to be allowed to have a return on equity of 10 percent from this project.

Asked how long it would take to build this airport, he said the first two runways could be finished by the 5th year and the entire development completed by the seventh year from ground-breaking.

He said SMC could fund the entire $10-billion cost on its own but it would be open to take in other local partners for the commercial/retail component or even for the airport operation component.

The Cyberbay project was originally envisioned to be a 750-hectare township development but the Supreme Court, in 2002, nullified a joint venture between the state-owned Philippine Estates Authority and Amari Coastal Bay Development Corp., formerly controlled by Ital-Thai consortium. Ang later bought into CyberBay as a personal investment.

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