Government Service Insurance System (GSIS) and the operator of Sofitel Philippine Plaza Manila have amended their existing lease agreement to include two adjacent lots formerly under dispute.
In a statement, GSIS said the updated agreement with Philippine Plaza Holdings, Inc. (PPHI) now encompasses the original building landsite as well as complementary lots 19 and 41.
The pension fund said this move reflects the commitment of both parties to the hotel’s continuous growth and the flourishing local tourism sector.
In May 2018, the state pension fund filed an eviction case against PPHI for using two GSIS properties without paying rent.
The two properties, lots 19 and 41, have a combined area of 7,393 square meters.
GSIS, then under the leadership of Jesus Clint Aranas, said PPHI was using those lots for its valet parking space, cistern tanks and cooling tower, tennis court, and other facilities.
Originally signed in 1991, the lease only covers the prime land occupied by the hotel.
The pension fund said that the amended agreement, which was initiated on June 26, 2016, is valid until June 26, 2041, ensures the hotel’s ongoing operations in Pasay City.
“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.
All alterations or improvements to the premises now require prior written consent from GSIS.
At the end of the lease period or in case of earlier cancellation, all permanent improvements introduced by PPHI on the building landsite and complementary lots will be transfered 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 arbitration rules.