Why Alphaland should be grateful to Binay
May I suggest to the Senate blue ribbon subcommittee chair Koko Pimentel: The whole thing started with the overprice of the Makati Parking Building, but it has gone far beyond that to include the seeming pattern of overprice for other buildings, “Hacienda Binay” in Batangas, and now the Boy Scouts of the Philippines/Alphaland issue. Who knows what other matters may come up?
One report covering all these may be too unwieldy, both for the writers and the public, and too much for the readers to digest. The purpose of all the hearings is in aid of legislation, but in the case of Vice President Jejomar Binay, since he is the only one who has thrown his hat into the 2016 presidential ring (lately joined by Davao Mayor Rodrigo Duterte), the report will also serve to help the people make up their minds.
Binay says that we should all wait for the courts to decide whether he is guilty or not, and that he should be presumed innocent. But that doesn’t fadge. Firstly, the Sandiganbayan averages eight years to decide a case; secondly, not all charges against him have been filed. And we the people have to decide by May of next year.
Anyway, the Senate subcommittee’s first report should cover its findings on the overprice of Makati City buildings; the second report, on the Batangas (Hacienda Binay) property; and the third report, on Binay’s actions on the BSP. If something new comes up, the subcommittee should issue a fourth report. Thus, there will be less risk of indigestion, and the subcommittee can be as detailed as it wishes to be. And the readers do not have to wait to start evaluating Binay’s qualifications.
Now I turn to last Wednesday’s hearing, with Roberto Ongpin and Mario Oreta of Alphaland in the “hot seat.” What did we learn from the hearing on: 1) what benefits the BSP got out of the deal; 2) what Binay got out of the deal; and 3) what Alphaland got out of the deal? (I touched on some of this in my column last Jan. 24.)
Oreta, in his letter to Ernesto Mercado which I adverted to in my earlier column, wrote that the BSP stood to earn P3 billion from the deal, and it was the best deal it would ever be able to make. This was repeated by Ongpin, Oreta’s boss, in the hearing. I don’t have a transcript of the hearing, but I do remember that Sen. Serge Osmeña wasn’t impressed at all. I heard him say that had the BSP just sat on the land (a little over one hectare), it would be worth at least P3 billion today.
(Actually, Osmeña was being conservative. He thinks it should be worth at least P4 billion, based on similar sales.)
In addition, the point is that the BSP apparently has not received a single centavo since the deal was struck seven or so years ago. Mercado said this a month ago (Jan. 22), and the hearing on Wednesday elicited the information from Oreta that he paid the BSP in January this year the rental for the use of its auditorium in the building—the amount being about P7 million (rental is more than P500,000 a month). So Alphaland had been using the space for about a year. I think it was Sen. Sonny Trillanes who asked: When in January? Jan. 23, the day after Mercado made his statement.
See what I mean? The question I would like to ask is: Why didn’t Alphaland pay the rent monthly? Others get their rent in advance, for heaven’s sake. The BSP got its rent after a year’s use!
Now the next issue: what Binay got from the deal. This was first exposed by Mercado last month, when he claimed that he wanted an 80-20 deal instead of the 85-15 deal that he got, but both Oreta and Gerardo Limlingan told him that the difference of 5 percent would be used for Binay’s 2010 election campaign. The Wednesday hearing brought out that there were deals between Alphaland and Noble Care (Oreta’s company), which sound suspiciously like Noble Care was being used as the conduit for the payoffs to Binay. Item: Alphaland reported to the Philippine Stock Exchange that it lent Noble Care P100 million, and then condoned the loan the following year—but Noble Care’s financial statements don’t show the transaction at all.
And then Ongpin said Oreta was not just an employee, he was given stock bonuses (like the negotiated deal with the BSP). The hearing showed that shares of stock were transferred at par value of P10 (for a total of P20,000) to Noble Care, and then were converted to 8.9 million other shares valued at P89 million. Worse, the value of those 8.9 million shares, according to the PSE, was not P10 but P62. This, all within Noble Care.
It’s pretty hairy, I know, but I think what the hearings are going to show is that somebody actually made over 500 million from what was valued at P20,000, and that somebody who benefited was likely Binay. A conjecture on my part.
Why should Alphaland be so grateful to Binay? Only think. Binay put the two—the BSP and Alphaland—together. No other possible partners. Then, it was Makati who changed the classification of the property from industrial to commercial, giving Alphaland a boost. Then, Makati, as an “incentive” to Alphaland (it has not done this to anyone else), changed its floor area ratio (FAR) from 6-8 to 12.
What does this mean? That the floors that Alphaland can build on the property was increased by 50 percent! This was given in 2012 by Makati. How can you connect it to Binay? Well, the foundations of the buildings were built sometime in 2009, presumably to a FAR of 8. But the foundations were not changed in 2012. So either Alphaland, as far back as 2009, knew that FAR 12 was coming, or the buildings now in place are at great risk.
