Ayala, SM, Aboitiz, Megaworld likely to pull out of Laguna Lakeshore PPP if…

THE “mega” consortium formed by the country’s  biggest property developers is pulling out of the running for the P123-billion Laguna Lakeshore Expressway Dike deal if the government proceeds with the auction on Monday.

Individuals with direct knowledge of the matter told the Inquirer that the Team Trident consortium, whose members are Ayala Land Inc., SM Prime Holdings Inc., Aboitiz  Equity Ventures Inc. and Megaworld Corp., will not be submitting a bid on March 28, 2016 due to several unresolved issues.

A key deal breaker for Team Trident, the largest of the three pre-qualified groups eyeing the public private partnership (PPP) project, was the lack of a guarantee over the “road connectivity” for the expressway dike deal, one of the individuals said.

These worries cover connections to the C5 and C6 projects, the person said. A Team Trident spokesman did not respond to requests from the Inquirer to comment.

Bidders have continuously maintained that the Laguna Lakeshore Expressway dike was among the more attractive deals in the PPP pipeline. But it is almost one of the most complex.

The project combines a 47-kilometer tollroad from Taguig in Metro Manila to Los Baños, Laguna running on top of a massive flood control dike under a 37-year concession period.

The project’s main business opportunity is a 700-hectare land reclamation project on Laguna Lake. The winning bidder can develop the reclaimed land into mixed-use projects. This would be the largest property project of its kind so close to Metro Manila.

The Department of Public Works and Highways earlier this month moved the bid submission deadline to March 28 from March 14, 2016 “to make the necessary modifications to the contract to address certain foreseen risks”. The bid submission has been delayed several times since July last year.

Public Works and Highways secretary Rogelio Singson said last week there would be no further delays to the March 28, 2016 deadline.

Team Trident has been the most vocal in airing its concerns over the Laguna Lakeshore Expressway dike project, although other groups have been flagging risks.

These include political uncertainties given that the project, which is expected to be built from 2017 through 2024, would be awarded months or even weeks before President Aquino steps down in the middle of this year.

The two other pre-qualified groups are a unit of conglomerate San Miguel Corp. and Alloy Pavi Hanshin LLEDP Consortium, comprised of Malaysia’s MTD Group, South Korea’s Hanshin and the family of former Senator Manuel Villar Jr.

Neither group has categorically signaled that they would pull out of the project. San Miguel president Ramon S. Ang said last week that they were still keen on bidding.

The  Laguna Lakeshore Expressway dike deal, like other PPP projects under procurement, is not covered by the election ban.

Data from the PPP Center showed 14 projects now under procurement with a combined value of P556.6 billion. So far, 12 deals valued at over P200 billion have been awarded and four are set to be finished before President Aquino steps down in the middle of 2016.