Monday, April 23, 2012

Housing Sales Explains SBMA Few Years of Profit

Comment from a reader on SBMA's losses:
The increase in SBMA’s income stream in 1999 and 2000 was likely a result of Felicito Payumo’s initiative, who was then, the relatively new SBMA Chairman and Administrator. In his attempt to increase SBMA revenues,  chose to divest SBMA’s interests in Freeport housing and encourage the “sale” of residential units in the Zone. SBMA’s original acquisition of housing units, after the departure of the US Navy, totaled 1867 units.  Apart from units already privately leased, and those earmarked for senior SBMA officials other government agencies (BI, BoC and Customs), the remaining housing units were offered to the public in an attractive range of between $27,300.00 to $40,000.00 each, on a long term lease basis of 25 and 50 years.  Several independent developers obtained clusters of derelict units for discounted prices and many individuals acquired them with the intention of renting out and/or reselling at a substantial profit. Needless to say, they were all snapped up in a relatively short period of time thus contributing significantly to SBMA’s revenue. 

From the Bugle: Thanks for the excellent analysis!

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