BusinessWorld: Davao City defers decision on Ayala Land realty project

DAVAO CITY, Philippines — This city’s legislative council on Tuesday deferred the reclassification of a piece of land that will allow the Ayala group to proceed with its Ayala Center Davao business park and mall project. But council leaders said there was no problem with the application, and that the reclassification of the 9.5-hectare property from a residential into a commercial zone would be approved as soon as several agencies are consulted. Majority Floor Leader Danilo C. Dayanghirang said the city would prioritize the project of Ayala Land and partner Anflocor Management and Investment Corp. The city government has sought the opinion of the Department of Public Works and Highways and Traffic Management Group on the possible traffic gridlock the project might cause. The project sits on a property in front of the city’s Redemptorist Church in Bajada district, right next to Victoria Plaza shopping center, two kilometers north of the city’s downtown. "Once we finish clarifying issues on drainage and traffic, the council will approve it as soon as possible," he said. The proposed Ayala Center Davao business park and mall project along J.P. Laurel St. is expected to stimulate the city’s economy in terms of tax take, increased land valuation and new jobs, an official of the company said. Dave Blas, senior architect of Ayala’s innovation and design group, said the mixed-use center, which includes the 55,000-square meter Ayala Center and a 22,000-square meter business process outsourcing building would result in more revenues for the city. "In the retail component, it will translate to sales taxes, business permit and other fees, and the appreciation of the land valuation, which translates to [higher] real estate taxes," he said in a presentation to the city council yesterday. Based on the plan, the business process outsourcing building will have five levels, while 10,000 square meters inside the shopping mall will be used for call center operations. The construction will come in four phases starting next year and is expected to be completed by 2012. The centerpiece of the project, the Ayala Center Davao, is expected to be completed two years earlier. The architect said they intend to incorporate the heritage of Davao City and Mindanao into the design of the mall. He said the center would build a reputation for Davao City as one of the country’s premier shopping destinations. Councilor Arnulfo R. Cabling, housing committee chairman, said the new investment would generate 5,000 new jobs. He said the six owners of residential houses inside the area had posed no objection to the development. — Joel B. Escovilla, BusinessWorld