Pension fund, property firm to develop serviced apartment in Makati

MANILA, Philippines - A state-led pension fund and a food conglomerate’s property unit will form a joint venture that will develop a serviced apartment in the Philippines’ premier business district. The Government Service Insurance System (GSIS) and San Miguel Properties Inc. (SMPI) will improve a 1,766 square meter property in Legaspi Village, Makati City. Upon improvement, the entities—through a joint venture called JVCo—will “develop the property into a service apartment," as designed and specified by the parties, SMPI said in a disclosure to the Philippine Stock Exchange (PSE). Generally cheaper than hotels, serviced apartments are furnished facilities designed for short stays with amenities for daily use. JVCo, which is also expected to run the property, will have an authorized capital stock of P600 million, the same statement said. The pension fund has already assigned the property—worth P300 million—to the joint venture as payment for its stake in the entity. Once the transaction is considered tax-free by the Bureau of Internal Revenue (BIR), SMPI, for its part, will allot P300 million to JVCo for its ownership of 300,000,000 shares in the venture. “The payment of SMPI of its foregoing subscription in the JVCo, to be recorded in the books of SMPI as additional investment, will be funded through internal resources and is not expected to have any material impact on the consolidated net tangible assets and earnings per share of SMPI for the current financial year," the SMPI statement said. - GMANews.TV