SM Land Inc. has offered to invest P20 billion for the development of the 33.1 hectare prime government property south of Fort Bonifacio and a secured yearly revenues totaling P25.9 billion over a 20-year period.

The state-owned Bases Conversion and Development Authority (BCDA) Thursday announced that SMLI’s unsolicited joint venture proposal would be subject to competitive challenge as required under Annex C of the NEDA Joint Venture (JV) Guidelines.

SMLI’s proposal includes an upfront cash of P2 billion upon signing of the JV contract and secured yearly revenues, totaling P25.9 billion for 20 years, for a present value of P36,900 per square meter.

Investment commitment of SMLI for the project stands at a minimum of P20 billion.

The property is composed of lands presently occupied in part by the Army Support Command (ASCom) and Special Services Unit (SSU) of the Philippine Army and in part by the Bonifacio Naval Station and Philippine Marine Corps of the Philippine Navy.

These lands were transferred and subsequently titled to BCDA for disposition/sale pursuant to the BCDA charter (R.A. 7227), which was passed into law in 1992 during the administration of President Corazon Aquino. These lands are outside the areas earlier identified by President Noynoy Aquino for long-term lease to generate funds to augment the AFP Modernization budget in his State-of-the-Nation Address (SONA).

BCDA said that SMLI shall advance the funds for and undertake the replication of military facilities affected by the development of the property. Final determination of the replication cost of affected military facilities is currently being undertaken.

Under the BCDA law, bulk of the disposition proceeds from Fort Bonifacio and Villamor Air Base goes to the AFP Modernization Fund which urgently needs more cash infusions as well as the AFP replication and relocation expenses.

As of December 31, 2009, BCDA has generated P46.495 billion in disposition proceeds.