The current issue:
After legal disputes in lower courts dating back to 1993, the Supreme Court decided in December 2021 that Taguig City has territorial jurisdiction over the region. Despite Makati's request for the High Court to reconsider, the Special Third Division of the SC definitively refused the city's move in September 2022, stating that the fundamental problems Makati highlighted had already been addressed and "duly" taken into account by the court.
Abby Binay, the mayor of the town of Makati, insisted that the conflict has not yet been resolved and even urged Makati residents to proclaim their ownership of the disputed site.
Lani Cayetano, the mayor of Taguig City, was forced to request that the Supreme Court issue a show-cause order against Makati in order to confront Binay's "troubling claims" about the property dispute between the two cities. She first stated that Makati will abide by the Supreme Court's ruling in July of this year. She even stated that for a smooth transition, she and the Makati government would communicate with the relevant ministries and agencies.
The two officials allegedly met during a meeting at the Department of Education and the Makati local chief executive claims that meeting did not go well. Binay asserted that during their conversation, Taguig asserted ownership of buildings in the disputed areas that Makati had paid for with public cash.
Forcible Take Over of Some Schools
Makati City accused Taguig City of trying to "forcibly take over" 14 public schools that were situated in the disputed regions on August 13 and referred to the action as a "act of duplicity and bad faith."
Several "enforcers" from Taguig's public safety department allegedly tried to "forcibly take possession" of a number of public elementary and high school buildings in the embo barangays, according to Makati City Administrator Claro Certeza. Makati said it planned to pursue criminal and administrative charges against Taguig based on his claim that these enforcers lacked any valid writ of execution or other legal order and "created unnecessary tension in these areas."
The SC ruled that Taguig City has territorial control over the Fort Bonifacio Military Reservation as well as the barangays of Pembo, Comembo, Cembo, South Cembo, West Rembo, East Rembo, and Pitogo. As a result, among other portions of the city, Makati is no longer in control of the Philippine Army headquarters, Navy Installation, Marines headquarters facilities, consular areas, Heritage Park, Libingan ng mga Bayani, AFP Officers' Village, and six other villages.
Benigno "Ninoy" S. High School, Comembo Elementary School, Rizal Elementary School, Pembo Elementary School, and Makati Science High School are among the 14 public schools impacted by the conflict. Aquino High School, Tibagan High School, Pitogo Elementary School, Pitogo High School, Cembo Elementary School, East Rembo Elementary School, West Rembo Elementary School, and South Cembo Elementary School are some examples of nearby high schools.
What will happen to Makati District 2?
Makati City, known as the financial center of the Philippines, is divided into several districts. The issue revolves around District 2, which is home to a mix of commercial, residential, and institutional properties, including condominiums and universities. In recent times, the local government has embarked on a takeover process, citing various reasons such as urban planning, public infrastructure, and development projects.
Cembo, Comembo, East Rembo, Guadalupe Nuevo, Guadalupe Viejo, Pembo, Pinagkaisahan, Pitogo, Post Proper Northside, Post Proper Southside, Rizal, South Cembo, and West Rembo are among the 13 barangays that make up Makati's second district. From 2007 to 2016, Binay served as its congressional representative. Luis Jose Campos Jr., Binay's spouse, is presently its representative.
In 2020, the Philippine Statistics Authority estimated that there were about 375,000 people living in Makati's second district.
Ten of these barangays—Cembo, Comembo, East Rembo, Pembo, Pitogo, Post Proper Northside, Post Proper Southside, Rizal, South Cembo, and West Rembo—have now been relocated to Taguig as a result of the decision.
With just Guadalupe Viejo, Guadalupe Nuevo, and Pinagkaisahan remaining, the second district will have a total population there of little more than 40,000 people.
Given that the Constitution requires each province and city to have a population of at least 250,000 people in order to have at least one representative in Congress, this whole system might potentially mean that the population of the remaining three barangays won't constitute a legislative district.
Binay, however, has reiterated that she is concerned for her former Makati citizens and that Taguig has also contacted Makati for "a coordinated and orderly transition." The conflict's long-term ramifications are still unknown.
What's in it for you as a potential condo investor?
The recent issue of the takeover of Makati District 2 has sparked significant discussions and concerns, particularly among condo investors in the Philippines national capital region. This development has raised questions about property ownership rights, investment security, and the overall real estate landscape in the country. In this explainer, we will delve into the details of the Makati District 2 takeover and its potential impact on condo investors.
The Take Over Process
The takeover process involves representatives of the local government acquiring private properties, including condos, located within District 2 for the purpose of implementing urban development initiatives. This process typically entails negotiations, legal proceedings, and compensation to property owners. However, concerns have arisen regarding the fairness of the compensation offered, the impact on property values, and the rights of individual property owners.
Impact on Condo Investors:
- Uncertainty: The takeover has created an atmosphere of uncertainty among condo investors. Property ownership is a long-term investment, and the sudden prospect of a government takeover can disrupt investment plans and financial stability.
- Property Values: The announcement of a takeover can impact property values in the affected district. Investors might face challenges in reselling or renting out their condos due to the uncertainty surrounding the future of the area.
- Compensation Concerns: The compensation offered to property owners during a takeover is a crucial consideration. Investors might be concerned that the compensation might not adequately reflect the market value of their condos, potentially leading to financial losses.
- Investment Confidence: The takeover might erode investor confidence in the real estate market, not only in Makati but also in other areas. Investors might be hesitant to commit their funds to properties if they fear similar takeovers could occur elsewhere.
- Legal and Procedural Challenges: The legal aspects of the takeover process can be complex and time-consuming. Investors might face challenges in navigating the legal proceedings and ensuring that their rights are protected.
- Ripple Effect: The impact of the takeover might extend beyond just condo owners. It could affect businesses, renters, and the overall economic ecosystem of the district.
Investor Strategies:
- Legal Counsel: Condo investors should seek legal counsel to understand their rights and options during the takeover process. Legal experts can help investors navigate negotiations, compensation terms, and any legal actions that may be required.
- Stay Informed: Staying updated on the latest developments and announcements regarding the takeover is crucial. Investors should engage with local news sources, government statements, and legal updates.
- Diversification: Diversifying investment portfolios can mitigate risks associated with a single property. Investors might consider diversifying across different districts or even different cities to reduce exposure to potential takeovers.
- Long-Term Perspective: Investors might need to adopt a long-term perspective, acknowledging that real estate investments inherently carry risks and uncertainties. Patience and informed decision-making can help weather such challenges.
The Makati District 2 takeover has raised significant concerns among condo investors in the Philippines. The uncertainty surrounding property ownership rights, compensation terms, and overall investment security has created a complex landscape for investors to navigate. As the situation unfolds, staying informed, seeking legal guidance, and considering diversification strategies will be crucial for condo investors to protect their interests and make well-informed business decisions in the ever-evolving real estate market.
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