Biz Buzz: BDO’s horizontal expansion
Over the years, the Sy family’s BDO Universal Bank has made it its business to gobble up as many financial institutions it could find to become the country’s largest bank—something it has already achieved.
Now, it seems that the bank has decided to embark on another expansion project. This time, however, the expansion will be made on the horizontal rather than vertical plane. Literally.
Biz Buzz has learned that the country’s largest private financial institution has acquired a building adjacent to its twin-towered Salcedo Village headquarters in Makati City. We’re talking about the pink-colored Gercon Plaza that has been standing on Makati Ave. since the 1980s.
The reason? The rapidly expanding financial arm of the Sy business empire needs more room to grow, as the two towers of the BDO headquarters—formerly the head office of PCI Bank—has become increasingly crowded, of late.
Since the owner of Gercon Plaza—the late Gerry Contreras—passed away without leaving any heir, BDO decided to make a pitch for the building to the businessman’s surviving relatives.
And agree to sell, they did, giving the growing BDO more room to grow in the literal sense. The final price was “a little under P2 billion,” according to our source, and the pleased relatives of Contreras were all present when the deal was sealed.
We understand the existing tenants of the 11-story Gercon Plaza have been notified that their leases would be terminated at the end of this year, which means BDO will move some of their operations in by 2016.
Incidentally, ‘haters’ of Vice President Jejomar Binay had once opened an investigation into Contreras’ business activities, supposedly because they believed that the latter was acting as a dummy for the former’s Makati properties—something they were ultimately unable to prove.
In any case, what remains unclear is what the new owners will do with the building’s penthouse floor, which houses the late businessman’s personal residence, complete with a lush garden and a swimming pool.
Oh, by the way, there are sporadic reports from the building’s former and existing tenants that some parts of Gercon Plaza are haunted, especially the areas near the elevator banks. Now that should be an interesting challenge for the SM group’s feng shui geomancers.–Daxim L. Lucas
‘Sisterhood’
It seems a high-ranking government official was suddenly bitten by the travel bug.
In recent months, this official has been attending office-related activities even in far-flung provinces despite having shunned such events since assuming office.
Our buzzard said this was highly unusual since the bureau chief was known as a “homebody.” In fact, this official usually sends proxies for activities that require even a short plane ride.
But since December last year, this temperamental and foul-mouthed official and his deputy have been seen in high spirits during personal appearances far away from the confines of the office.
According to our buzzard, this official apparently found a new “inspiration,” “kindred spirit” and “travel partner” in one of the agency’s deputies who has long been suspected by close associates of being a closet case.
What worries top executives of the agency’s mother unit is the alarming “coziness” which reportedly clouds the bureau chief’s judgment. It appears that the official has been turning a blind eye on the deputy’s corrupt ways to the point of “getting away with murder” and sacrificing the agency’s reform agenda.
Despite the rumors, the two officials have been inseparable during official outings. In fact, agency insiders said the official himself has been planning more trips out of the office to deepen the bond of this “sisterhood of traveling jowaers.”–Gil Cabacungan
‘Powerless’ MMDA
It may be the influential big brother of the metropolis, as far as development planning and transport and traffic management are concerned, but the Metropolitan Manila Development Authority (MMDA) is “powerless”—literally—when it comes to the electrification of its southwest provincial terminal in front of Uniwide Coastal Mall.
We heard that Manila Electric Co. recently cut off the power supply to the Uniwide Coastal Mall due to the Uniwide group’s unpaid electricity bills reaching over two million pesos as of end-February. Because MMDA’s terminal in front of the mall does not have its own utility meter and has only been riding on the Meralco account of Uniwide (which then bills MMDA), when the lights go out in Uniwide, then the same happens to the terminal.
A total of 1,000 franchised buses will be handled by the MMDA’s southwest terminal, estimated to serve over 30,000 commuters daily.
This means that the MMDA would have to install emergency generators for its southwest provincial terminal every night (or look for a friendly neighbor to link up to) until the supply is restored. Otherwise, this area will be gloomy and scary and attract unwanted elements in the evening. On the other hand, since control of the Uniwide property has reverted to the group of businessman Jacinto Ng after a long legal battle, Uniwide (whose corporate rehabilitation has been terminated) has little incentive to settle bills that were left behind.–Doris C. Dumlao
New investment house
China Bank is positioning itself to be a bigger player in local investment banking by investing P500 million to create an investment house subsidiary to be named China Bank Capital Corp.
Currently, all deal-making activities are done by an in-house unit, but the bank now sees the need to set up its own unit. As part of the country’s largest conglomerate SM Investments Corp., the bank must be missing out on a lot of investment banking opportunities and synergies by not doing this sooner.
We heard that the bank, which is run by the sons of retail tycoon Henry Sy, is set to hire a new guy from British bank Barclays to run the new unit.–Doris C. Dumlao
Shot down
Remember that interesting suggestion by businessman Manuel V. Pangilinan on solving an impasse over the location of a railway common station in Quezon City?
That’s the one where Pangilinan suggested that it would be more efficient for the government to build one common station for MRT 3, LRT 1 and eventually MRT 7 between the shopping malls of SM Group and Ayala Land, instead two stations—one for each property.
That single facility, after all, can have exits to both malls just like similar stations in Hong Kong. Well, it looks like that’s not going to happen.
Transportation Secretary Joseph Abaya said that shifting their plans right now made little sense, and that building one station instead of two was simply too “troublesome.”
For the department, this is a case where more common stations—even just hundreds of meters apart—are better, given the legal complications it has gotten itself into. That’s not even getting into technical issues to be considered in terms of MRT 3’s operations.
Recall that the problems started when the department decided in 2014 to move the location of the common station to Ayala Land’s Trinoma, including this in a contract for the Light Rail Transit Line 1 Cavite extension PPP deal that Ayala and Pangilinan’s Metro Pacific Investments eventually won.
The thing is, the government signed an agreement with SM Group years before for the station to be located near SM City North Edsa, located just across the street.
SM, of course, ran to the Supreme Court and that pending decision is basically causing a lot of uncertainty for commuters, SM, Ayala and maybe even the LRT 1 PPP if this drags on long enough.
The good thing is, Abaya is keen to see this through within President Aquino’s term. He said they plan to iron out issues with all stakeholders in the coming months.–Miguel R. Camus
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