NAIA

NAIA rehab: In leaked memo, ADB makes the case to extend bid deadline

Lance Spencer Yu

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NAIA rehab: In leaked memo, ADB makes the case to extend bid deadline

NAIA. The facade of the Ninoy Aquino International Airport.

Angie de Silva/Rappler

Some potential bidders have already requested for an extension, but the government seems to be determined to stick by its original December 2023 deadline

At least six local and international players are racing to bid for the rehabilitation of the Ninoy Aquino International Airport (NAIA), but with the deadline fast approaching, some potential bidders are asking for more time to study the project, according to an Asian Development Bank (ADB) memo that was leaked to the media.

In the leaked document, ADB – the government’s transaction advisor – suggested extending the deadline for all bidders to January 2024 “in light of the upcoming holiday season.”

Will the government yield?

Under the original timeline of the Department of Transportation (DOTr), the final concession agreement is set to be released within the first week of December, with the deadline for the submission of bids on December 27. 

The private concessionaire that wins the bid will have the daunting – but profitable – task of elevating the country’s international gateway to global standards, including improving the processing time for passengers and upgrading infrastructure.

Given the current timeline, parties interested in bidding will have more or less 20 days from the release of the final agreement to the bid submission deadline to decide whether or not the multi-billion project is worth taking on.

With the December deadline coming soon, the ADB recommended that the DOTr approve a one-month extension “to give bidders more time to prepare and submit bids.”

“They have asked for more time to request and analyze additional information from MIAA and DOTr, and to secure their internal corporate approvals, which will take longer in light of the upcoming holiday season,” the ADB said in a memo not meant for public release.

The ADB also noted that several bidders have already requested for an extension. Should the DOTr push through with the original deadline, the ADB said that the bidding might only gain participation from local potential bidders who are already familiar with the airport. 

San Miguel Corporation is among the local players who have bought bid documents for the NAIA rehabilitation project. San Miguel also has the franchise to build and operate the New Manila International Airport in Bulacan. (READ: San Miguel already owns Bulacan Airport. Can it get NAIA too?)

Besides San Miguel, the Manila International Airport Consortium (MIAC) has also expressed strong interest in NAIA, even submitting an unsolicited proposal to upgrade NAIA, although it was ultimately thumbed down by the government. MIAC consists of many of the same companies that tried to rehabilitate NAIA during the Duterte administration.

The ADB believes that extending the bid submission deadline will attract more bids, including foreign investors that may need more time to study the ins and outs of the airport and business environment.

The ADB made no official announcement related to the request for a deadline extension. A transportation official confirmed to Rappler that the memo was an internal document that was leaked to the media.

Will the government extend?

But despite the calls to extend, it seems the government will stick to the original deadline.

“No extension, per Secretary, so the schedule will not get delayed,” a transportation official close to Transportation Secretary Jaime Bautista told Rappler.

Bautista had previously said that a winning bidder could be awarded by early 2024.

This means that potential bidders will have to rush amid the holiday season to wrap up their due diligence and come to a decision.

So far, there have been eight parties that have bought bid documents: MIAC, San Miguel Corporation, GMR, Spark 888 Management, Asian Airport Consortium, Cengiz Insaat Sanayi ve Ticaret A., Incheon International Airport Corporation, and Limak Group.

Out of these eight, six potential bidders have continued to express interest in the NAIA rehabilitation, according to Manila International Airport Authority (MIAA) head Bryan Co.

“‘Yung si Spark, hindi na nagpaparamdam at saka si Limak. Si Limak, nag-change daw direction ng board,” the MIAA officer-in-charge told Rappler during a security inspection of the Philippine Village Hotel.

(Spark hasn’t been in touch, and neither has Limak. For Limak, they said that their board changed directions.)

The winning bidder will have 15 years – with a possible 10-year extension – to operate and maintain NAIA. During that time, the private concessionaire will be expected to increase passenger capacity from 32 million to 62 million passengers per annum.

As part of this airport rehabilitation, the private concessionaire may also expand NAIA Terminal 2 using the land of the recently repossessed Philippine Village Hotel, MIAA’s head said.

“We have to make the land available for a private proponent to expand. As to the design, we will not specify. What we will specify in terms of references, as well as the standards that we will do with the private proponent, is more of what are the capacities that we want,” Co told Rappler. – Rappler.com

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Lance Spencer Yu

Lance Spencer Yu is a multimedia reporter who covers the transportation, tourism, infrastructure, finance, agriculture, and corporate sectors, as well as macroeconomic issues.