The Government Service Insurance System (GSIS) and Philippine Plaza Holdings Inc. (PPHI) have amended their existing contract of lease, securing the future of the Sofitel Philippine Plaza Manila hotel.
Expanding upon the original terms, the updated agreement includes not only the building landsite but also the complementary lots, specifically Lots 19 and 41.
The two first entered into the agreement in 1991, covering the prime land occupied by the luxury hotel.
The amended agreement, which was initiated on June 26, 2016, is valid until June 26, 2041.
GSIS and PPHI have agreed to treat the entire area as a unified and indivisible unit.
Any modifications or enhancements made to the premises now require prior written consent from GSIS.
At the conclusion of the lease period or in the event of early termination, any permanent improvements introduced by PPHI on the building landsite and complementary lots will be transferred to GSIS.
The updated agreement also includes a dispute resolution clause, outlining a path towards resolution through negotiation, mediation or arbitration in accordance with the Philippine Dispute Resolution Center Inc. arbitration rules.
In 2018, GSIS filed an eviction suit against PPHI at the Pasay City Regional Trial Court for “using two GSIS properties and earning from them without paying the owner.”
GSIS then said the lots in question do not refer to the area where the hotel sits but to the two adjacent lots, 19 and 41, that PPHI is using for its operations without paying rentals.
The two lots, with combined area of 7,393 square meters, was being used by the hotel for its valet parking space, cistern tanks and cooling tower, tennis court, and other facilities.
This extension of the lease showcases the mutual dedication of both GSIS and PPHI to the sustained growth of the hotel and the flourishing local tourism sector, the pension fund said.
“Sofitel hotel’s success is intrinsically linked to GSIS, as its income will be drawn from the hotel’s revenue. By safeguarding GSIS’s assets and generating income from these, we can assure our members and pensioners that their benefits will be provided when due,” GSIS president and general manager Wick Veloso said.
