Biz Buzz: Buying air rightsBy the staff
Philippine Daily Inquirer
Upscale property developer Alphaland Corp. topped out last week its 34-story Alphaland Tower, which company president Mario Oreta says will be the “newest, smartest and prettiest” building along Ayala Avenue, the country’s version of Wall Street.
At a cocktail party that toasted the structural topping out (in construction, the ceremonial placing of the last beam at the top of the building), Oreta says the P3-billion skycraper will be open for business by January 2013.
More importantly, Alphaland—led by the group of former trade minister Roberto V. Ongpin—paid about P93 million to purchase “air rights” from the owner of the adjacent KPMG Center (the former Prudential Bank building), thus giving an unobstructed view of the central business district on its left side.
Oreta said the building owner sold the equivalent of four unused floors from its 16 floor area ratio (equivalent to about 9,600 square meters of floor area) entitlement.
This means that if they decide in the future to tear down the current building and build a new one, it has waived the right to build anything taller that will block Alphaland’s current view.
Interestingly, Oreta also made a pitch for the air rights of the current Vicente Madrigal building on Alphaland Tower’s right side, to no avail. The Madrigals agreed to meet up with Oreta but in the end, the latter was told: “We have more money than Alphaland, so why should we sell to you?”–Doris C. Dumlao
Where’s the ore?
Corporate regulators and bourse officials are supposedly looking into the activities of this particular mining firm, which is a favorite of punters and speculators.
According to our sources, this company has been raking it in by selling nickel ore to buyers in China (hence its attractiveness to stock market speculators). However, we hear that not all the revenues are recorded in the company’s books.
Supposedly, some of the proceeds from the sale of nickel ore were reportedly diverted directly into the Hong Kong bank account of the company’s owner. The result is that the company’s revenues, as reported to local corporate regulators and the stock exchange, were being under-declared.
Too bad for its fans in the stock market once the ongoing Securities and Exchange Commission’s probe is concluded.—Daxim L. Lucas
Kapitan’s estate planning
Shortly after news broke out that Michael Tan is Kapitan Lucio Tan’s choice as successor, the heir-apparent was spotted hanging out with brother Bong (Lucio Tan Jr.) in a plush watering hole on Bonifacio High Street. So for those predicting blood amid the long-rumored sibling rivalry between the brothers, it seems that they are still on speaking (and drinking) terms. It also appears that Michael’s early move has been to reach out to the family members, seen by close observers as a prudent move.
This means that Michael—while deserving to being the successor to Kapitan’s throne—still needs to navigate cautiously and prove his mettle to the family.
Meanwhile, Kapitan’s estate planning moves are far from over. What will be consolidated into Tanduay Holdings are major businesses in the Philippines, but the group has vast offshore estate assets as well, not just in China and Guam, but also in Papua New Guinea. LT group sources said three of Kapitan’s large offshore companies are:
– Eton Properties Group, established in the 1980s, one of the biggest unlisted private real-estate businesses in Hong Kong with a value of over $2.6 billion;
– Dynamic Holdings Ltd., an investment holding company listed in Hong Kong, operates property rental segment and property sales segment in China consisting of offices, shopping mall and car parks in Beijing and Shanghai. This unit has a market cap of about $356.55 million; and
– Kenmore Group, one of the largest conglomerates in Papua New Guinea with interests in property, industrial, automotive, transport, agriculture and finance businesses.
Meanwhile, one crucial amendment to the corporate by-laws recently approved by the board of Tanduay—alongside the consolidation of major LT Group businesses—is the insertion of a provision on a “non-compete” clause, which will disqualify business competitors from becoming directors and/or officers in the future umbrella organization. This is obviously a poison pill meant to avoid the return of Kapitan’s estranged brother Mariano Tanenglian (in case this brother outlives Kapitan) or even any kin who will build any enterprise inimical to the group’s interest.—Doris C. Dumlao
Gagged … and exiled
The supposed “gag order” (but they don’t call it that, officially) issued by Finance Secretary Cesar Purisima on officials under his command seems to be working. The outflow of information from the department—so far—has become carefully vetted and officials now speak with one voice (or not at all).
For one ranking undersecretary that has supposedly become Purisima’s pet peeve, a mere gag order is not enough. According to Department of Finance insiders, the finance chief had ordered the transfer of the office of this undersecretary from the main DoF building to the adjacent ESDC building within the central bank compound.
Visible from the Roxas Boulevard side, the ESDC building is an imposing, bunker-like structure that houses some of the central bank’s auxiliary offices. It is also lightly used, with many dark and wide corridors, whose wood panels have remained unchanged since the 1970s. It is also—according to central bank insiders—haunted.
In any case, allies of this DoF official are upset with his proposed transfer since the ESDC building—a veritable “Siberia” posting—supposedly has “no office space worthy of an undersecretary.”
In the wake of the gag order, the concerned undersecretary has made it a point to supply his friends in the media with a steady stream of research notes about the Philippines from investment houses.
Where there’s a will, there’s a way.—Daxim L. Lucas
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