Refurbished golf course to revive Subic airport

Subic Golf Course operator Hanafil Golf and Tour Inc. will revive the Subic Bay International Airport by bringing in more foreign golfers once the golfing facility is finished.

The company plans to resume its junket flights after golf course stakeholder Hanatour, South Korea’s largest tourism company, pledged to bring in tourists directly to Subic.

“We are planning to use the SBIA and a partner airline company with low cost fares to bring in more golfers from other countries. The golf course was designed to handle 180 golfers a day, and that number will expand once we add nine more holes in the next phase of the development,” Hanafil President and CEO Benjamin John Defensor III said.

Currently, the company has completed 40 percent of the reconstruction process for the course.

“That includes the reshaping of the greens and fairways of the first nine holes to make it flow better,” Defensor said.

“Current improvements are the eco-friendly irrigation system that uses recycled water, brand new nursery that can use salt water and the drainage system that was replaced to accommodate the volume of rainfall come this rainy season.”

“But these renovations are not just for new members; the company is also accommodating all previous members of the golf club as long as they update their accounts and coordinate with us and the SBMA (Subic Bay Metropolitan Authority),” Defensor said.

An agreement was signed recently between the Bureau of Immigration (BI) and the SBMA and Clark Development Corporation (CDC) that would allow visa-free entry to foreigners visiting the two free ports.

Under the agreement signed by Immigration Commissioner Marcelino Libanan with SBMA Administrator Armand Arreza and CDC President Benigno Ricafort, officers and personnel of foreign locators in the two free ports may now enter and stay in the country without a visa for a period of 14 days.

The privilege, however, will only be extended to those arriving through the Diosdado Macapagal International Airport (DMIA) or the SBIA. (Jonas Reyes, Manila Bulletin)

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Subic Golf Course to sell $20-M shares

Around $20-million worth of shares are up for grabs as soon as the Securities and Exchange Commission (SEC) approves the selling of Subic Golf Course membership inside this premier Freeport.

Subic Golf Course operator Hanafil Golf and Tour, Inc. released the statement, adding that the money will be used for further development of the area.

Hanafil CEO Benjamin John Defensor III said that they are also planning to absorb all of the members the golf course that are in good standing.

He added that they would also be opening their doors to members who went dormant but would want to update their membership with the new golf course operator.

The golf course’s 500 members are composed mostly of Filipinos, but Defensor said that with the trend Subic Bay Freeport is going, it would not be long that foreign golfers would take the majority of members.

“We have already tapped Netforce International to reconstruct the facility. We are currently replacing the greens and fairways to make Subic Golf a world-class golf course, and we are utilizing the new nursery inside our facility to create the greens,” Defensor said.

Plans of building a new hotel and some luxury villas around the golf course are on the way, but the company reiterated that the developments being made are for the current and future members to appreciate.

“These developments will bring up the value of their shares,” Defensor said.

A study by the company shows that the peak season for golfing falls from January to March for cold weather countries, April to May for local golfers, and October to December. These are the times when the golf course is really busy.

The company plans to employ more than 150 golfing staff to accommodate the growing number of members, with a policy of preferably a golf staff per member every time they play.

With the recent acquisition of large local investors in the area like Ayala Land, expect Subic Bay Freeport to be at the forefront of tourism sites in the country today. (Jonas Reyes, Manila Bulletin)

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Hanafil starts $5-M renovation of Subic golf course

In a simple “dirt pushing” ceremony, Subic golf course operator Hanafil Golf and Tour Inc. began on Wednesday a one-year renovation program designed to upgrade the fairways here to world-class standards and bring in more foreign tourists next year.

Leading the ceremony on Wednesday night at Subic’s Binictican area was Subic Bay Metropolitan Authority (SBMA) administrator Armand Arreza, SBMA chairman Feliciano Salonga, Hanafil chairman Jay Kim, Hanafil president Benjamin John Defensor III, and Netforce International president Bong Arguelles.

Arreza, who drove a bulldozer at the project site to kick off the dirt pushing rites, described the event as “a momentous occasion” to mark the reconstruction of the prized Subic facility.

“We want to upgrade the golf course here, put it at par with international standards, and place it at the forefront of SBMA’s effort to further enhance the tourism market in Subic,” Arreza said.

“We believe that Subic Golf has proven its capability to bring in more tourists to Subic after its highly-successful junket flight program that brought in more than 1,800 Koreans to play golf in the freeport,” he added.

Arreza also said that the renovation of the Subic golf course will prepare local tourism establishments “for more opportunities coming their way.”

According to Defensor, the $5-million renovation program to be implemented in a year is just part of the overall $48-million development package that Hanafil intends to implement in Subic.

Reiterating Hanafil’s commitment to the SBMA to fulfill its development plans, Defensor said more projects would soon follow after the renovation.

“We are committed. In the bigger picture of things, the golf course will only be one of the attractions that we are going to build,” Defensor said.

Defensor said that Hanafil, which is now one of the largest companies in Subic in terms of committed investment, has contracted out the renovation work to Netforce International, the country's number one golf course builder and designer.

“We chose Netforce, a company which has an extensive experience in building golf courses, because we would also like to support the economy by hiring Filipino companies like Netforce,” Defensor added.

Netforce officials, meanwhile, revealed that in renovating the whole golf course, the company would reshape the existing greens, using paspaplum grass for the greens and Tifton 419 for the fairways. Completion is scheduled for November 2010.

Defensor said the renovation is timed to be completed “just when it starts getting cold in the northern countries.”

Hanafil, which mainly targets golfers from South Korea, will resume its junket flight program immediately after the golf course is fully renovated.

Defensor said the firm’s first junket flight program with Jeju Airlines has proven to be a success, with about 1,800 Koreans participating in three-day golfing holidays organized by Hanafil.

Defensor also said that during the renovation period, the whole 18-hole golf course would be closed “so that we could fully reconstruct the whole area.”

He added that the company is coordinating with Netforce and other construction firms to ensure that golf course employees who would have to be laid off during the renovation stage, could be absorbed by the contractors.

Hanafil is a Philippine corporation registered with the Securities and Exchange Commission, and is backed by Hanatour, the biggest tour company in South Korea. (SBMA Corporate Communications)

PHOTOS:
[1] SBMA chairman Feliciano Salonga (second from right) and SBMA Administrator Armand Arreza (third from right) join Hanafil officials in launching the $5-million renovation program for the Subic golf course. Also in photo are (from right): Hanafil chairman Jay Kim, Hanafil president Benjamin John Defensor III, SBMA senior deputy administrator for support services Ramon Agregado, SBMA deputy administrator for business development Raul Marcelo, and Netforce president Bong Arguelles.

[2] SBMA administrator Armand Arreza drives a bulldozer during the “dirt pushing” ceremony to start the $5-million renovation program of the Subic Bay golf course.

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Court junks case vs. Hanafil, SBMA

The forcible entry charge filed by the former operator of the Subic Bay golf course against its successor, the Hanafil Golf and Tour Inc. (Hanafil), and the Subic Bay Metropolitan Authority (SBMA) has been dismissed by a court in Olongapo City.

Judge Rosemary Bautista, presiding judge of Branch 3 of the Municipal Trial Court in Cities (MTCC-3), threw out the case filed by the Universal International Group Development Corp. (UIGDC) after concluding that the Taiwanese-owned firm has engaged in forum shopping.

Bautista signed the order clearing Hanafil and the SBMA of charges of forcible entry on June 18, according to Hanafil president and CEO Benjamin John Defensor III.

In effect, the court “recognized the right of the SBMA to terminate its lease development agreement [LDA] with the UIGDC, thereby making it clear that Hanafil is the new rightful lessee of the property,” Defensor explained.

In dismissing the case filed by the UIGDC, the court noted that the complainant had filed different cases in different courts against the SBMA and Hanafil.

According to Judge Bautista, evidence submitted by the parties indicated that the UIGDC has initiated three separate actions before different courts.

These included a petition for certiorari with prayer for preliminary mandatory injunction and temporary restraining order (TRO) filed in April 2008 before the Court of Appeals (CA); the forcible entry case filed in May 2008 before the MTCC-3 in Olongapo; and the case for breach of contract and damages, annulment of lease development agreement with prayer for TRO and preliminary mandatory injunction filed in January 2009 before Branch 72 of the Regional Trial Court in Olongapo City.

Proving the presence of these cases filed before various courts, Bautista ruled that the UIGDC is guilty of forum shopping and all the elements of litis pendentia.

Hanafil, a Filipino-Korean joint venture backed by Hanatour, Korea’s biggest tour operator, took over the management of the 19-hole Subic golf course last year after winning in a public bidding for the operation of the facility.

The SBMA itself took over the facility in June 2007 after the UIGDC failed to settle financial obligations to the SBMA that have ballooned to some $150 million, as well as to honor its development commitments under its lease development agreement.

Among the unfulfilled commitments in UIGDC’s 1995 agreement with the SBMA were the construction of world-class facilities like a new clubhouse, a 100-room condominium, 30 VIP villas and a five-star hotel and resort prior to the Asia-Pacific Economic Conference summit meeting in Subic in November 1996.

Meanwhile, SBMA Administrator Armand Arreza clarified that because the LDA between SBMA and UIGDC was rescinded on June 8, 2007, by the SBMA board, a lessor-lessee relationship no longer exists between the two parties.

He added that the SBMA validly pre-terminated the LDA because the lessee committed contractual breaches.

“As a consequence of the valid pre-termination, SBMA has repossessed the golf course without any court order,” Arreza also explained.

Arreza said that no less than the Supreme Court has upheld the validity of the provisions in the LDA between UIGDC and SBMA, including the pre-termination and repossession of the property by UIGDC in case of violations by the company.

For its part, Hanafil has complied with all the requirements of the SBMA, Defensor averred.

He added that the firm has started the reconstruction of the Subic golf course into a world-class, all-weather championship golfing facility with 27 holes.

Hanafil is also completing plans to build a five-star hotel and luxury villas near the golf facility, Defensor said. (Henry Empeño, Business Mirror Online)

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Subic golf course partially open despite $48M facelift

Hanafil Golf and Tour Inc. said that the Subic golf course will remain open amid its re-development costing $48 million.

Hanafil Golf chief executive and president Benjamin John Defensor III said the management had decided to open facility after a clamor by members of the Subic Bay Golf and Country Club and local players to at least open nine holes of the 18-hole golf course.

“We want them [members] to enjoy their game even during the rainy season. It is our pleasure to give our utmost services to them,” Defensor said.

“The renovation of the Subic Golf Course into a world-class golf course would be done by phases. We will open holes 1 to 9 but would close the remaining holes for us to renovate the old US Navy golf course,” he added.

He said the massive development project of Subic Golf was part of the agreement between Hanafil and the Subic Bay Metropolitan Authority.

“We have scheduled the reconstruction of the Subic Golf Course during the rainy season to take advantage of the minimal number of golfers playing here,” Defensor said.

He said the golf course was just one of the many attractions that Hanafil will build inside this premier Freeport. The company also plans to build a five-star hotel and luxury villas.

“The nursery and the irrigation system are almost completed. These were created in preparation for the reconstruction of the golf course. The nursery is necessary because the greens and fairways of the whole golf course will be replaced,” he said.

Defensor said the new irrigation system was designed to supply water to the golf course, stressing that the system is eco-friendly and uses wastewater for the greens and fairways. (Cecille Garcia, Manila Standard Today)

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Hanafil to start Subic golf course rehab in June

Construction of additional facilities to transform the 18-hole Subic Bay golf course here into an all-weather championship sporting venue will begin next month when the rainy season starts.

The course, a favorite among golfers from South Korea, will be closed to customers during the construction period, according to Hanafil Golf and Tour Inc. chief executive officer Benjamin John Defensor III.

”We have scheduled the reconstruction of the Subic golf course during the rainy season to take advantage of the period when a minimal number of golfers play here,” Defensor explained.

He added the construction is part of the company’s agreement with the Subic Bay Metropolitan Authority (SBMA), which awarded the operation of the facility to Hanafil late last year.

Hanafil, a Korean-Filipino joint venture backed by Hanatour, Korea’s biggest tourist agency, announced last year its $48-million commitment to redevelop the golf course at Subic’s Binictican area into an all-weather championship course, with full-blown country club amenities.

The firm said the six-year development program includes the construction of nine more holes, a hotel and some villas, and improving the driving range.

Defensor added that after building a new restaurant, acquiring new golf carts and other equipment, Hanafil is about to complete installation of a new irrigation system and establishment of a nursery.

“All these are just preparation for the reconstruction of the golf course. The nursery is necessary because the greens and fairways of the whole golf course will be replaced,” he said.

A typical 18-hole golf course consumes approximately 500,000 gallons of water every day, but the new irrigation system installed by Hanafil is eco-friendly and is designed to use wastewater for the greens and fairways.

“There is absolutely no impact on the underground rivers in the area and will not affect the supply of fresh drinking water in Subic Bay,” Defensor said, adding the expansion of the fairways was meant to eventually turn the Subic course into a venue for international tournaments, as well as to accommodate the increasing number of golfers visiting Subic Bay.

Since the firm’s takeover of the facility last year, the Subic Bay golf course has become the favorite of thousand of Koreans who were brought to Subic under “golf junket” flights organized by Hanafil in January to March this year.

He said the 18 trips from Incheon, Korea, had helped project Subic Bay as “the next big thing” in adventure tourism among big Korean groups.

”The new Subic golf course is just one of the many attractions Hanafil intends to build inside this premier free port. The company is currently making plans to build a five-star hotel and several luxury villas,” Defensor added. (Henry Empeno, Business Mirror)
IN PHOTO -- Hanafil President and CEO Benjamin Defensor III (right) is spearheading the redevelopment of the Subic Bay golf course into an all-weather facility.

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Hanafil to fly in foreign golfers next year

Subic golf course operator Hanafil Golf and Tour Inc. is now preparing to fly in golfers from various parts of the world after the company began the re-development of the golf links here into a venue for professional tourneys.

Hanafil president and CEO Benjamin John Defensor III said the firm will tap an international airline to accommodate “junket flights” for golfers.

”We want to fully utilize the advantage of Subic Bay Freeport's location by using the Subic Bay International Airport (SBIA) as the entry point for international golfers," Defensor said.

"We are now working out a deal with an international airline to ferry golfers to Subic by January next year," he added.

As planned, the so-called junket flights will be twice a week and using airliners capable of ferrying some 180 passengers, Defensor revealed.

Subic Bay Metropolitan Authority (SBMA) Administrator Armand Arreza, meanwhile, said the entry of foreign golfers in Subic would certainly boost Subic’s tourism industry.

“It has been awhile since we had junket flights, which were organized previously by casinos to bring in players from all over Asia. This will be the first time that junket flights will be used to ferry golfers,” he added.

Arreza also expressed optimism that foreign golfers would enjoy playing in Subic, especially since Hanafil had initiated renovation of the Subic golf course to make it at par with some of the world’s best.

Hanafil’s Defensor said the company has recently installed a new irrigation system, built a new restaurant, and acquired new golf carts to upgrade amenities at the 18-hole course. It has also built its own nursery as part of the program to expand the course by an additional nine holes.

Defensor added that the expansion of the fairways was meant to accommodate the growing number of golfers coming into Subic Bay.

He added that the recent opening of the Subic-Clark-Tarlac Expressway (SCTEX) drew a remarkable increase in the number of golfers playing at Hanafil’s newly-renovated course, especially during long weekends.

Hanafil is a subsidiary of Hanatour, a company listed in both the London Stock Exchange and the Korean Stock Exchange. Hanafil, on the other hand, is a Philippine corporation registered with the Securities and Exchange Commission (SEC). (SBMA Corporate Communications)

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Subic golf course contract not a ‘sweetheart deal’

The Subic Bay Metropolitan Authority (SBMA) has vehemently denied allegations that it has entered into a “sweetheart deal” with Hanafil Golf and Tour, Inc., a Korean-Filipino firm that is set to pour $48 million to redevelop the Subic Bay golf course.

SBMA Administrator Armand Arreza stressed that the agency had observed due process in awarding the contract to Hanafil, in accordance with RA 9184, otherwise known as the Government Procurement Reform Act.

“How could it be a sweetheart deal when, clearly, our agreement with Hanafil assures the government a P14-million income annually compared to the P3.6-million promised by the former operator?” Arreza asked.

“And this P14-million rental will be paid on top of a five percent revenue sharing scheme, as well as the $48 million development commitment,” he said.

Arreza also explained that the SBMA awarded the lease and development contract to Hanafil because the firm offered terms “most advantageous to the government” among the eight proposals received by the SBMA’s Bids and Awards Committee (BAC) for infrastructure.

“All these underwent the legal process — from the publication of an invitation to submit comparative proposals, to the creation of an oversight committee composed of SBMA directors and managers to oversee the bidding process,” Arreza said.

“So there is simply no substance to this sweetheart deal angle foisted by some detractors who seem to relish the idea of reverting to the previous contract that didn’t work out,” he added.

Arreza clarified these points in reaction to claims by Northern Samar Rep. Emil Ong that the terms and conditions of the Hanafil contract were “grossly disadvantageous to the government” because unlike the Universal International Group (UIG), the former operator, Hanafil was given a one-year grace period from payment of rentals to allow the new operator to develop the golf course.

Arreza said, however, that the SBMA has given the UIG “more than enough concessions already” to enable it to make good on its development commitments that were agreed upon as early as 1995.

Among UIG’s commitments were the construction of a first-class clubhouse, a five-star hotel and resort, a condominium and VIP villas targeted for completion before Subic hosted the Asia-Pacific Economic Cooperation summit in 1996.

Arreza said that the SBMA had allowed the UIG’s original lease and development agreement (LDA) to be amended three times, with the first amendment in 2001 effectively reducing the UIG’s rental fees, performance bond and service fees, and extending the firm’s compliance period for its commitments.

However, by January 2003, the UIG still accumulated $44,070 and more than P25 million in arrears, and also failed to deliver on its promises.

The second amendment in 2003 stopped the imposition of service fees altogether and waived future interest on fixed service fees, while the third, in 2004, reduced UIG’s lease rate by 50% and deferred the imposition of escalation rates.

Despite these, Arreza said the UIG continued to default on its obligations under the LDA and under the compromise agreements, so that by the end of March 2007 the firm’s arrears had ballooned to more than $2.55 million and P47.73 million.

“The firm’s failure to settle its debts and to fulfill its development commitments forced the SBMA to terminate UIG’s LDA in May last year in order to protect the interest of the government,” said Arreza. (SBMA Corporate Communications)

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Hanafil golf deal ‘most advantageous’ to the gov’t

The awarding of a contract to develop the Subic Bay golf course to Korean-Filipino firm Hanafil Golf & Tour, Inc. is by far the most advantageous proposal for the government, the Subic Bay Metropolitan Authority (SBMA) said.

Reacting to allegations by Northern Samar Rep. Emil Ong that the terms of the lease given to Hanafil were “disadvantageous to the government”, SBMA Administrator Armand Arreza clarified that Hanafil won the open bidding for the golf course project “precisely because it gave the most generous offer.”

“Anyone, including Mr. Ong, can see for himself that Hanafil’s contract provisions are miles away in comparison with the old terms,” Arreza asserted.

He explained that while the former operator UIG International Development Corp. offered a rental of only P300,000 per month, or a total of P3.6 million in one year, Hanafil has offered $350,000, which translates to more than P14 million annually.

Aside from rental fees, Hanafil has also offered the SBMA a 5 percent gross revenue sharing and development commitments worth $48 million to be implemented within six years.

“Given these commitments by Hanafil, the P3.6 million annual income under the old contract that the honorable congressman seems to want to maintain simply doesn’t measure up,” Arreza said.

Arreza said the issue on the operation of the Subic golf course has been a “recurring theme” among some legislators like Ong ever since the SBMA terminated the UIG’s lease development agreement (LDA) last year due to ballooning debts amounting to $150 million.

He said Hanafil won over seven other companies in a bidding held last March that required proponents to deposit in an SBMA bank $3 million in initial development funds, as well as advance $400,000 in rentals to the SBMA treasury.

The bidding process was duly reviewed by an oversight committee composed of members of the SBMA board of directors and other officials of the agency.


As to the UIG, which is lobbying to repossess the golf course, Arreza said the SBMA “can no longer continue having false hopes with a repeat offender,” pointing out further that the SBMA takeover of the golf course last year and in 1997 had been affirmed respectively by the Regional Trial Court in Olongapo City and the Supreme Court.

“It’s precisely because the government was losing money from the continued operation of UIG that the SBMA took over the operations twice,” Arreza said.

“The SBMA has given the former operator enough concessions,” Arreza said.

However, the Taiwanese firm had “utterly failed to honor its development commitments made as early as 1995,” he added. These included the construction of a first-class clubhouse, a five-star hotel and resort, a condominium and VIP villas.

Ong had also asked the House committee on oversight to investigate SBMA’s awarding of the golf course lease to Hanafil, purportedly because the firm is headed by Benjamin John Defensor III, reportedly a nephew of pro-administration senator Miriam Defensor-Santiago.

Ong has also raised the possibility that Defensor “is just fronting for South Korean investors” since he reportedly holds less than one percent of the shares, while his Korean partners own 87 percent of the company.

That issue, Arreza said however, “is just water under the bridge.”

“What matters to us is the capability of the company to deliver — and we believe that Hanafil has that capability,” he added. (SBMA Corporate Communications)

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