National heritage law stunts property market

posted February 13, 2019 at 08:50 pm
by  Ray S. Eñano
National heritage law stunts property marketThe national cultural heritage law, or Republic Act No. 10066, has either altered many business plans or prompted some companies to advance their corporate decisions.

The law’s provisions defining what constitute historical and architectural landmarks are now the bane of property developers, especially in Metro Manila.

One specific provision of the law that classifies structures dating at least 50 years old as national cultural heritage has stopped one conglomerate from tearing one of its buildings along Ayala Avenue in Makati. The limit of the same provision led Bank of the Philippine Islands, the nation’s third-biggest lender in terms of assets, to go ahead with its decision to demolish its Ayala headquarters and construct a new one on the same area.

Owners of a 50-year-old building, according to the law, may petition the appropriate government agency to remove the “presumption of important cultural property which shall not be unreasonably withheld.”

The building owners may try to go around this route to escape the ambit of the law but they will likely jump the gun to avoid complexities. Besides, tearing down a building along the pricey Ayala Avenue and similar financial centers nearby before it turns 50 and building a new one on the same lot will be more profitable than keeping the old structure.

For the building owners, the demolition job (no pun intended) is the safest option to take before the property falls under the coverage of the law or is categorized as a historical landmark. 

The law defines historical landmarks as those “sites or structures that are associated with events or achievements significant to Philippine history as declared by the National Historical Institute.” Such definition is encompassing and subject to many interpretations. For a company trying to register profits and please its stockholders, the law’s provision is a risk.

Stock exchange building

Ayala Corp. built the 35-story Tower One & Exchange Plaza at the corner of Ayala Ave. and Paseo de Roxas to house the conglomerate’s offices and the Philippine Stock Exchange. Ayala planned a second tower on the site where the old Makati Stock Exchange Building stands, but being one of the first buildings in the Makati Central Business District, the exchange cannot just be torn down because of its contribution in Philippine commerce history. The building will be 50 years old in 2020.

But developers successfully moved for the demolition of the iconic Mandarin Hotel in Paseo de Roxas before it turned 50. Another landmark building, the Intercon Hotel, also a five-star hotel on Ayala Avenue, has been torn down to escape the provision of the national cultural heritage law. 

Bank of the Philippine Islands, the third-largest lender in terms of assets, meanwhile, will start constructing its new headquarters along Ayala Avenue in Makati City by the second quarter of this year.

BPI executive vice president, treasurer and global markets head Antonio Paner earlier said the bank would be “tearing down” its current head office built four decades ago in the first quarter this year. The bank moved forward the demolition of the building, which was built in 1979, to avoid being tagged 50 years old. 

BPI’s decision to construct a new building is an investment decision that stands to result in more profits. The bank plans to build two towers on its present site, with one intended for mixed-use purposes. 

The Lopez Group is spending P6 billion to redevelop the one-hectare site of the former Benpres Building in Ortigas Center into a two-tower office project to boost recurring income.

The Benpres Building, which will turn 50 this year, can be considered a historical landmark, being one of the oldest buildings in the Ortigas area. It was originally commissioned by the late Eugenio Lopez Sr. and built in 1969 to serve as the headquarters of the  Manila Chronicle. However, President  Ferdinand Marcos’ declaration of  Martial Law less than two years later saw the closure of the Chronicle. 

The building was returned to the Lopez family after the People Power Revolution of 1986 and renamed the BENPRES building after Eugenio Lopez Sr.’s parents, former Iloilo Governor Benito López and Presentación Hofileña López.

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Topics: national cultural heritage law , Bank of the Philippine Islands , Ayala Corp.
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