Biz Buzz: Megawide’s PPP pipeline

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01:41 AM December 10th, 2012

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By: the staff, December 10th, 2012 01:41 AM

After winning its first public-private partnership (PPP) contract involving a major school infrastructure project with the Department of Education, construction and engineering firm Megawide Construction Corp. is getting the hang of the PPP ballgame.

Megawide has bought the bid documents for the $377.6-million Naia Expressway and is now in the tender stage. But as its core interest is construction rather than tollroad operation, it’s in talks with the Metro Pacific group’s Manila North Tollways Corp. on a possible partnership. The Naia Expressway project, which will be bid out in February next year, involves the construction of a four-lane, 7.75-kilometer elevated expressway and 2.22-km feeder road that will provide access to Naia Terminals I, II and III and likewise link the Skyway and the Manila-Cavite Toll Expressway.

Another PPP project considered by Megawide is the $377.6-million build-operate-transfer project involving the construction of a 700-bed, super-specialty tertiary orthopedic hospital located within the National Kidney and Transplant Institute compound along East Avenue, Quezon City. The group is now scouting for a prospective partner, including international groups, with expertise in hospital operation. Recently, a Megawide team flew to Singapore to talk to prospective partners.

But if a Megawide-Metro Pacific alliance is possible in tollways, won’t a similar partnership in hospital project be far behind? The Metro Pacific group, which recently struck a deal to take over its seventh hospital, prefers taking over existing hospitals to building a new one. As such, we heard it has yet to make a decision whether to participate in this greenfield orthopedic hospital project.—Doris C. Dumlao

‘Not too delayed’

On the reported stumbling blocks to the Daang Hari toll-road project, the Aquino administration’s very first PPP project, PPP executive director Cosette Canilao said the point of contention was the new road that would connect to South Luzon Expressway. She noted that the SLEx operator finally made a decision that the Daang Hari project winner should include the expansion plans for SLEx. Canilao said this was fine because the Toll Regulatory Board had determined that such a provision was necessary.

As the required inclusion of the expansion would require changes in design, Canilao said that project winner Ayala and the Department of Public Works and Highways were now talking about the variation costs. “I’m proud of the contract because that contract itself includes provision for contract variation,” Canilao said. However, she declined to comment on an earlier reported range of P250 million to P500 million in variation cost (that the government is expected to shoulder).

The traffic simulation based on the conceptual design of DPWH, Canilao said, would indeed show a much better vehicular flow compared to the previous design. The PPP chief also noted that Daang Hari was “not that delayed,” as after the bidding in December last year and the awarding last January, six months was needed for detailed engineering design. “It’s proceeding,” she said.—Doris C. Dumlao

Start from scratch

With the country’s economic boom comes the inevitable downside of having the increasingly congested capital that is Metro Manila.

In fact, nary a day passes by without people complaining about the bad vehicular traffic situation in the metropolis that gets worse when the rains fall, causing the inevitable floods that come several times each year—something many attribute to poor urban planning.

The solution? Businessman Romeo Roxas and architect Jun Palafox Jr. believe that only a clean slate—that is, to start from the ground up—will solve the present woes of the Philippine capital.

Both men are now reviving the concept of setting up a new mega-city on the eastern seaboard of Luzon called the Pacific Coast City project.

First proposed in the late 1990s, the Pacific Coast City was endorsed by the government as early as President Ramos’ administration and was declared a “flagship project” by the short-lived Estrada administration in 1999.

Only this time, they’re no longer speaking of a “Pacific Coast City” but of a “Pacific Coast Cities” project.

Under the proposal, an area 25-percent bigger than Metro Manila would be allocated for the new urban center in Dingalan, Aurora, on the east side of Luzon, facing the Pacific Ocean. The total land area will also be larger than the entire island of Singapore.

If this dream comes true, the Philippines may finally have its first master-planned city, which will have enough room to grow for the next century and help decongest Metro Manila.

The proponents estimate that it will create up to five million new jobs and, over time, develop a tax base that will equal Metro Manila’s revenue-generating capacity of P500 billion a year (something that will, no doubt, find favor with fiscal authorities).

More importantly, it is only 80 kilometers away from Metro Manila—a short drive if a highway is built.

The question is … will the current administration look favorably on the project? Abangan.—Daxim L. Lucas

 

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