Villar firm’s high-end project sits on land for poor

By Aries Rufo,

Posted at Apr 14 2010 02:19 PM | Updated as of Apr 24 2010 09:28 AM

LAST of 3 parts

MANILA, Philippines – Presidential aspirant Manuel Villar may have built his P25-billion wealth on providing low-cost homes, but the practices of acquiring properties where real estate projects now stand showed a pattern of deceipt and corruption.

How land was acquired in Norzagaray in Bulacan, Imus Estate in Cavite, and for the Portofino project in Alabang are case studies of this pattern.

Related Content:

PART 1: Villar built business empire with deceit, corruption: ex-lawyer

PART 2: Villar firm faked titles through 'layering': ex-lawyer

PART 3: Villar firm’s high-end project sits on land for poor

PROFILE: The man who turned his back on Villar

SIDEBAR: Imus Estate land key to Villar-Ayala deal

SIDEBAR: Villar firms bribe and forge? The case of the undervalued crane

INTERACTIVE GRAPHIC: How Villar company obtained titles to contested land

VILLAR CAMP'S REPLY: Land grabbing allegations mere black propaganda: Villar

Portofino, a flagship project of Britanny Corp., the Villar Group’s unit aimed at the luxury residential communities and upscale leisure developments, now sits on land meant for the poor.

Portofino was cited in a complaint by Restituto Mendoza, a former lawyer of the Villar Group, as one distinctive example of the corrupt practices of the group.

Mendoza, in a damning complaint before the National Labor Relations Commission (NLRC ), said the real estate businesses of Villar pull strings in government agencies—like the Registry of Deeds and Land Management Bureau, the Department of Natural and Environment Resources, the Bureau of Customs to judges and justices, including in the Office of the President—to get their way.

In an interview with Newsbreak last April 7 in Mandaluyong City, Villar’s chief legal officer Ma. Nalen Rosario-Galang vehemently denied Mendoza’s allegations.

She said Mendoza had sought to blackmail Villar and his companies with his allegations of corruption “after he got slighted when told of his poor performance as an employee.”

She said Mendoza is only taking advantage of the political season to get attention. She pointed out that Mendoza “tried to sell his story” to Senators Jamby Madrigal and Panfilio Lacson, who both spearheaded the C-5 road extension inquiry. Advisers of the two senators rejected his “story,” Galang said, “since they know it cannot be used as evidence.”

Meant for low cost housing

Portofino is a 300-hectare community of different enclaves where houses and commercial areas have sun-drenched colors and high arched windows and archways. The architecture and design are inspired by a seaport town in Southern Italy named Portofino, meaning “fine gateway.”

But before the property became a gated subdivision and an enclave of the rich, Portofino was originally meant for low-cost houses .

The land was originally an agricultural land. The heirs of Conrado Potenciano owned 113 hectares.

In 1988, the Potenciano family and the National Housing Authority (NHA) entered into an agreement to develop the site for low-cost housing. The NHA is the government agency mandated to provide shelter to the lowest 30% of the urban population, most of them living in slums.

The NHA filed before the Department of Agrarian Reform (DAR) a request to convert the property from agricultural to non-agricultural. In 1989, it was granted.

The 1989 DAR conversion order gave Potenciano and the NHA 10 years to develop the site. The land’s tenants, who would have been the beneficiaries of the property had it been covered by the Comprehensive Agricultural Reform Program, were paid with disturbance compensation.

However, for some reason, the NHA backed out of the project.

With the NHA out, Potenciano and his heirs entered into a “Land Development Agreement” in 1993 with Adelfa Properties Inc. and Britanny Corp, both owned by the Villar Group. At the time, Villar, who has already made a stamp in the real estate industry, was a newly elected congressman and was starting a political career.

Daang Hari Road

In 1999, prior to the expiration of the 1989 DAR conversion order, Adelfa Properties and Britanny Corp. filed for an extension of the development period. It cited as grounds the construction of the Daang-Hari road, among others.

The Daang Hari road traverses Las Piñas and Bacoor, Cavite, in effect providing access points to Pontefino from existing major roads, including those that serve posh Ayala Alabang Village, and the Madrigal Business Park. (Newsbreak previously reported that the construction of Daang Hari was funded by the congressional allocation of Senator Villar in 2003 coursed through the Department of Public Works and Highways.)

Villar firm’s high-end project sits on land for poor 1


Adelfa Properties also sought a new order granting the conversion without any limitation to any specific use and development.

That same year, two groups of petitioners who are heirs of former tenants, asked the DAR to revoke its 1989 order and revert the property to agricultural land. The petitioners argued that the conversion plan was violated since the 10-year period has lapsed.

The DAR rejected the petitions of the two groups of petitioners, prompting them to separately appeal before the Office of the President and the Court of Appeals.

In March 2004, the Office of the President issued a resolution reclassifying the Potenciano property into agricultural land. Adelfa Properties filed a motion for reconsideration but was also denied.

The decision of the Office of the President, however, was short victory for the former tenants.

Connection to the president?

Mendoza, who was then hired by Adelfa Properties as in-house counsel, filed a second motion for consideration at the Office of the President. In October 2004, the Office of the President reversed itself and junked the tenants’ petition.

The Court of Appeals also junked the tenants’ petition.

Mendoza wrote on his labor complaint that he was elated for winning. It was his first big case. He was the one who insisted of filing a second motion for reconsideration, which is not generally entertained, but he argued it could be allowed be in exceptionally meritorious cases.

Mendoza thought he won the case through merit. He would have a rude awakening.

In the succeeding years of working with Villar’s lawyers and senior officers, he wrote that he found that the Potenciano case was won “through a connection within the Office of the President.”

SIDEBAR: Villar firms bribe and forge? The case of the undervalued crane

MANILA, Philippines – Customs officials were peppered with calls in 2009 to release a shipment that was confiscated because they were undervalued.

In an interview with Newsbreak, they said they were not aware that the confiscated shipment belonged to “people connected with a high official.”

They were referring to callers from companies associated with presidential aspirant Manuel Villar, Jr.

The shipment contained a tower crane, an equipment used in the construction of tall buildings. Real estate spawned the much-touted wealth of Villar, the only billionaire among elected officials. READ MORE

When he found this out, “it took complainant months to get over his guilt by knowing that he was instrumental to what he realized later as an injustice to hundreds of farmers hoping to regain their lost land,” Mendoza narrated.

Mendoza said that, when the farmers initially won at the Office of the President, they were seeking P25 million as settlement. He opposed the move, but curiously, Villar’s senior officers were willing to compromise. He bargained for P200,000, which the tenants at first accepted and later rejected.

He wrote that he would later realize Villar’s trusted men were getting kickbacks from settlement payments. The P200,000 settlement he was pushing apparently also angered Villar’s senior officers.

A separate source, who was privy to the case, said the conduit who secured the Office of the President reversal was a Villar associate, who got a juicy position when he was named Senate President. The associate was replaced when Villar was ousted as Senate chief in 2008. At the time, Sen. Lacson was pushing for the investigation of the C-5 road controversy.

Business ethics

Villar’s “Sipag at Tiyaga,” a catchy slogan that makes an emotional connection with the poor that they, too, can make it big, resonates the message that industry and perseverance, guided by ethics and principles, will make dreams come true.

But ethics and principles may not be among Villar’s strongest traits in business, Mendoza noted in his labor complaint.

Mendoza said the irregular practices of Villar’s lawyers were not so secret among themselves. He said Galang, Villar’s chief legal officer “was quite at ease with the knowledge that extra legal means were being done with the cases they were handling.”

When he confronted Galang about his moral dilemma, he was told that he “should act first as an officer of the company and not as a lawyer.” Mendoza said Galang reminded him “to just focus on the legal aspect and just let (Villar’s senior officers) and Adelfa’s engineers do all the ‘dirty’ work.”

Galang, in a separate interview, said that Mendoza has a problem with authority. “He thinks he is too good. That is why he did not last long with his previous employers.”

Villar told ABS-CBN News on April 13 that all their lands have titles and were acquired above-board. He added that negatives stories about his businesses, especially those on alleged land grabbing practices, are mere black propaganda- With reports and additional research from Ma. Althea Teves and Purple Romero,

Editors' note: We previously reported that, when Adelfa Properties was pursuing the reclassification issue with the Office of the President in March 2004, Villar and Arroyo critic Senator Alan Peter Cayetano aligned themselves with the opposition. We were wrong. Villar’s Nacionalista Party was not active during the 2004 national elections where both Villar and Cayetano supported President Arroyo’s bid. Cayetano joined calls for President Arroyo to resign in mid-2005 following the “Hello Garci” wiretapping scandal, but Villar did not. Villar later became Senate President.