No refunds please, we’re Filipino-Chinese

The Mall of Asia, considered as one of the region's largest shopping centers, is owned by SM Prime Holdings Inc., which also runs Save More, a grocery store chain. (Photo by Nonie Reyes)

[UPDATED 11 May 2011 after correcting figure in 5th paragraph.]

What would you do if the government wanted to give you your money back?
You’d grab it faster than a crooked general would feign amnesia at an anti-corruption hearing. [Which actually took place in this country. See: Amnesia grips witnesses]
After all, refunds don’t happen often enough, especially in the Philippines, a country where getting your money back is as rare and difficult as getting your money’s worth.
But six months ago, the Philippine government — through the Metropolitan Waterworks and Sewerage Systems (MWSS) — did just that.

Shown is a photocopy of a P33-million check representing the advance rent and security deposit, among others, of SM for the lease of MWSS' Katipunan Ave. property. Click to enlarge.

The MWSS reportedly returned P33 million (roughly $763,000) to SM Prime Holdings Inc., the Philippines’ largest mall developer which is owned by Henry Sy Sr., the country’s richest Filipino.
Why?
The agency reportedly sought to revoke a lease contract its officials entered into with SM Prime’s executives. [See: MWSS may cancel contract with SM, offers refund]
The contract, which would supposedly allow SM Prime to build Save More, a stand-alone grocery, on the MWSS’ Katipunan Ave. property was allegedly disadvantageous to the government, a source familiar with the matter said. [See: MWSS leases Katipunan property to SM Prime Holdings]
Under the lease agreement, SM reportedly agreed to pay the MWSS P100 per square meter or P1,200 annually for 25 years for a property that is reportedly worth P40,000 per square meter, a separate but unsigned document* claimed, citing current zonal values estimated by the Bureau of Internal Revenue (BIR).
“Selling prices [for properties in the area] range from P50,000 to P70,000 per square meter,” the same document said.
It added that rent should be twice than what was agreed upon, citing the property’s market value and interest rate projections.**

On the left is a photocopy of a receipt issued by the MWSS for a P33 million check it received from SM Prime Holdings Inc. On the right is a photocopy of a deposit slip indicating that the check was deposited to the account of the MWSS at the Philippine National Bank. Click to enlarge.

Moreover, rent payments of P100 a month exclude value added taxes, which, in turn, would be shouldered by the MWSS. As a result, the water agency would only get rent payments worth P88 monthly or P976 annually per square meter, an amount less than half of the estimated P2,400 it should supposedly receive.
The contract was entered into by Diosdado Allado, then MWSS administrator, and current SM Prime President Hans Sy Jr. on May 27, 2010, a month after the term of ex-President Gloria Macapagal-Arroyo ended.
In short, the lease contract covering an MWSS property along Katipunan Avenue may be considered a midnight deal.

Shown are signatures of ex-MWSS administrator Diosdado Allado and SM Prime Holdings Hans Sy Jr. on the contract's last page. Click to enlarge.

Shortly after the issue was reported in August last year at GMANews.TV, MWSS officials issued a check to SM Prime.
The check the MWSS issued was worth P33.248 million, equivalent to the amount of the check it received earlier from SM Prime Holdings Inc.
It was promply endorsed by official signatories around the time President Benigno Aquino III — in his first State of the Nation Address as Chief Executive — publicly excoriated MWSS officials and employees for receiving excessive bonuses for a year’s worth of work. [See: MWSS officials, staff received 25 bonuses]
The P33-million check was then reportedly hand-delivered to SM Prime’s offices at the Mall of Asia.
Except that no one supposedly wanted to receive it.
Question now is: what is the current status of the contract?
No one knows.
Text messages seeking clarification about the matter have already been sent to Allado, an SM Prime senior executive who handles media queries, and other government sources.
No reply from any of them has yet been received as of posting time.
Should we then kiss the checkout girls goodbye?***

———————

*A source gave me the document, saying it came from someone who was also familiar with the matter but refused to be involved nor identified. Contents of the document, including financial estimates, have yet to be disputed.
**According to the document, rental rate per annum is equal to: Market value multiplied by interest rate prevailing, say of Treasury bills. “If we assume a fair market value of P60,000 per square meter and an interest rate of four percent per annum, the annual rental rate per square meter should be P2,400, not P1,200,” the document said.
***The line was borrowed from Steely Dan’s The Last Mall, one of the cuts from its 2003 album, Everything Must Go. [See: Steely Dan, Everything Must Go]

From The Before I Forget Dept. This blogger owns shares in SM Prime Holdings Inc., as of posting time.

From the Google is Your Friend Dept. A copy of a blueprint of MWSS’ Katipunan property can be found here while MY estimate of where property exactly is can be found here. WARNING: I get lost in Makati City.

Consumers buy in bulk, depleting supermarket supplies

Metro Manila residents are buying goods in bulk, depleting inventories of supermarkets, hours before a typhoon is expected to make landfall.

Consumers have made a mad scramble for items such as sardines, biscuits, instant noodles, candles, batteries, and flashlights, the president of a Philippine supermarket association told GMANews.TV.

“People are alarmed and they are buying more than what they need,” Steven T. Cua, president of the Philippine Amalgamated Supermarkets Association Inc., (Pagasa), said. The industry group is composed of supermarkets that serve the low to upper-middle market.

“Selling areas are crowded and queues are very long,” he said on Friday evening as television news programs aired reports of empty grocery shelves.

Demand for instant food items have surged since these can be prepared and consumed easily, Cua said.

These food items can also be transported with minimal difficulty should consumers be forced to relocate and/or leave their homes in case of floods, he added.

For the past few days, appetite for instant food items was driven by bulk-buying for relief operations for victims of the storm Ondoy.

But on Friday night, consumers stocked up on their supplies, alarmed that a new storm may unleash effects similar to those wrought by ‘Ondoy’ just a week earlier.

In the meantime, demand for candles, batteries, and flashlights was spurred by rumors that the Manila Electric Co. (Meralco) will be cutting off power in its areas upon the arrival of typhoon “Pepeng.”

Meralco, Metro Manila’s lone electricity distributor, has denied the report.

To ensure that inventories are well-stocked, supermarkets have switched brands, especially if quality, price, and sometimes even the manufacturer are the same, Cua said.

He also acknowledged that inventories have been reduced as some deliveries were delayed by floods that were caused by record amounts of rainfall a week ago.

But buffer stocks of basic goods remain stable, Cua said.

This view is shared by Corazon C. Curay, logistics director at the Makati-based XVC Logistics Inc. Curay is also the president of the Supply Chain Management Association of the Philippines (SCMAP), an industry group that represents firms that store and deliver goods made by manufacturing giants such as San Miguel, Nestle, and Johnson & Johnson.

Damage to inventories has been minimal, Curay told GMANews.TV in an earlier phone interview held four days after Ondoy submerged the Philippine capital.

“Manufacturers just have to catch up on production,” she said, adding that some companies may be forced to sell their products in larger or smaller sizes, depending on their stocks.

Although Curay expects an increase in bulk prices of raw materials, companies will refrain from passing on the hike to its customers since it may translate to lower market share.

She also downplayed apprehensions that delayed deliveries and increased demand will boost basic goods’ prices.

Cua agreed.

Despite reports of increased bulk-buying – which raises the possibility of higher goods prices – neighborhood groceries have yet to buy double of what they usually purchase, Cua said. This indicates that they do not expect higher prices in the short term, Cua explained.

“If they wanted to take advantage of higher prices in the future, smaller stores would have bought more,” Cua said.

“People are just reacting too quickly to news of the storm,” he said. “Consumers should just buy supplies good enough for one and a half days, instead of three.”

Good books and groceries

books

GOOD books and groceries—like beer and tequila, socialites and squakings—rarely go well together. (I should know—I’ve sworn off tequila more than ten years ago—after having barfed bits of my brain out on a Bacolod to Manila flight minutes prior to touchdown, thanks to copious Cuervo Gold shots chased by beer the night before. Meanwhile, to this day, I remain confused which social category best deserves my working-class rage: uppity Makati coño kids with trust funds or unsophisticated squakings in Quezon City who can’t even ride the train right. But enough of this self-indulgent commentary lest it deteriorate into pure drivel, if it hasn’t already).
As I was saying, good books and groceries don’t go well together.
No one visits a bookstore to get a discount on Kobe beef nor does anyone make a trip to the grocery to try and stumble upon Adrian Cristobal’s Occasional Prose, which remains sadly out of print.
But stranger things have happened.
For more than two years, my wife and I have frequented this grocery, the name and location of which will not be disclosed for reasons that will become self-evident later.
Just last year, the establishment suddenly decided to put up two stalls filed with used, cheap books, many of which I would have been proud to call my own.
Acting on this impulse, I have, in various trips to the said grocery store, I have amassed a number of excellent titles.
Take my recent trip last week.
While my wife was busy figuring out what needed to be restocked in our household—not exactly rocket science for a two-member, one feline family—I trooped to the used-book stands and immediately scanned titles for possible finds. It was, by far, the best decision I have ever made regarding anything faintly related to groceries.
Besides acquiring the 29th issue of Granta, a UK-based literary quarterly, I also got myself a copy of the Granta Book on the Family, a special anthology featuring memoirs of American short story writer Raymond Carver, among others. The last, but not the least, of my literary haul was Best Music Writing of 2004, published by Da Capo press, which I am reading right now.
All three books—expensive-looking trade paperback editions in good condition—set me back by approximately P300, far cheaper than the latest issue of Granta, occassionally sold at Fully Booked for P700 or so.
On another occasion, I have bought Sleeping with Extra Terrestrials: The Rise of Irrationalism and Perils of Piety by Atlantic Monthly columnist Wendy Kaminer, Bad Elements by journalist Ian Buruma, The Tale of the Scale: An Odyssey of an Invention by Solly Angel, a housing expert.
Which now explains why I will not disclose the name and location of the said grocery store for fear that readers of this blog, however few, may stake out the establishment, hiking competition for good but cheap books.
But since I believe in a level playing field, I will nevertheless give one clue regarding the whereabouts of the said grocery: it’s in Metro Manila. Hardy har har. Why would I take the fun out of grocery shopping?

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From the Six Degrees of Separation Dept.
Raymond Carver’s best friend is Chuck Kinder. Besides being a writer himself, Kinder, who also teaches fiction at the University of Pittsburgh, is supposedly the basis of one of the characters in Michael Chabon’s novel, Wonder Boys, which was later turned into a movie. When we were in the US, my wife and I occasionally joined the movie nights that he hosted at his house. I remember seeing the original Carrie movie and Short Cuts, a movie on which a number of Carver’s short stories are based. Short Cuts features, among others, jazz singer Annie Ross who plays, not surprisingly, a jazz singer. Ross is famous for being one-third of what I believe is the greatest jazz vocalist group of the twentieth century, LHR, also known as Lambert, Hendricks, and Ross. LHR has influenced similar groups such as The Manhattan Transfer and New York Voices.
Picture shows covers of Wendy Kaminer’s Sleeping with Extra Terrestrials: The Rise of Irrationalism and Perils of Piety and Best Music Writing 2004.