PPP auction successful

AN AUCTION for a second public-private partnership (PPP) project has been deemed a success by the government, which yesterday named two groups as the winners of contracts to build classrooms in three Luzon regions.

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The Department of Education (DepEd), in a statement, said BF Corp.-Riverbanks Development Corp. and Citicore Investments Holdings, Inc.-Megawide Construction Corp., Inc. had successfully bid for the Public Private Partnership for School Infrastructure Project (PSIP).

Build-lease-transfer contracts expected to be soon awarded involve the construction of 9,301 classrooms, with toilets and furniture, in the Ilocos, Central Luzon and Calabarzon regions over a 10-year period.

The BF Corp.-Riverbanks and Citicore-Megawide tenders — worth a total of P16.28 billion based on a table of annual lease payments — came in under the approved contract budget of P16.4 billion, the DepEd said.

BF Corp.-Riverbanks set annual lease payments at P344.59 billion for 2,157 classroom packages in the Ilocos region, while Citicore-Megawide pegged these at P522.898 billion and P760.490 billion, respectively, for 2,885 classrooms in Central Luzon and 4,259 in Calabarzon.

“The two companies offered the best bids. They passed all the technical requirements and their bids were within the ceiling set by DepEd,” PPP Center Executive Director Cossete V. Canilao yesterday said in a phone interview.

“The projects are awarded to them in principle and there is a very small chance that it will not be given to them unless a post-bid review sees they are not able to comply with the requirements,” she added.

Notices of award will be sent in the next four weeks, the DepEd said. Ms. Canilao added: “The actual groundbreaking could happen by October”.

Manuel Louie B. Ferrer, Megawide Construction Corp. vice-president, said the firm had yet to be notified by the DepEd.

“We’ll start as soon as we receive the contract,” he said in a phone interview.

The DepEd said it had programmed costs of P620,812 for a single-storey classroom and P1.062 million for a two-story structure, inclusive of toilets and furniture. A little over two-thirds, or 69%, of the 9,301 classrooms required will be two stories. Also factored in were costs for maintenance (to be done every four and a half years), financing and taxes.

Six firms/consortiums — BF Corp.-Riverbanks, Citicore-Megawide, D.M. Consunji, Inc., Makati Development Corp.-First Balfour, Inc., D.M. Wenceslao & Associates, Inc.-DATEM, Inc. and Makati Development Corp.-DDT Konstract, Inc. — had prequalified to bid.

Only BF Corp.-Riverbanks and Citicore-Megawide submitted financial and technical proposals by a July 18 deadline. The DepEd said the technical proposals, including mock-up structures constructed in Malolos, Bulacan, were found to be compliant with the project’s minimum standards and specifications.

Once awarded, the PSIP would be the second successful PPP deal for the Aquino administration following delays since the centerpiece infrastructure program was launched late in 2010.

So far, only the P1.956-billion Daang Hari-South Luzon Expressway link project has been awarded, to Ayala Corp., last December.

Likely to be auctioned off next is the P60-billion Light Rail Transit-1 extension and management contract, for which an invitation to pre-qualify has been issued. –NOEMI M. GONZALES, Reporter, Businessworld