By Sidharath Kapur (Delhi, India)
Acceptance of the unsolicited proposal and signing of the concession agreement for the Bulacan Airport project in September 2019 is a watershed in terms of infrastructure privatization. It is possibly for the first time globally that a project of this magnitude and having such a major impact on the economy is being awarded to private sector through an unsolicited proposal (USP).
The project awarded to Sam Miguel Corporation (SMC) for 50 years is an alternate to the highly congested NAIA Airport in Manila. The outlay of the project at P735 billion (equivalent to USD14.3 billion in today’s dollars) is ambitious and probably surpasses the New Istanbul Airport in vision and complexity. The project, to be built on about 6,000 acres of reclaimed land northwest of Manila, will have capacity of over 100 million passengers with four runways.
The initial phase is expected to cost P450 billion (about USD8.8 billion) and includes an eight-kilometer toll-road linking the project to the North Luzon Expressway which is expected to cut down travel time from EDSA, Manila to the new airport to 60 minutes. A large part of the reclaimed land is planned to be used for developing an aero city thus bringing in a lucrative real estate angle to the project.