BCDA to generate Php48 billion from NAIA terminal 3 disposition

In Photo: Bases Conversion and Development Authority (BCDA) President and CEO Engr. Joshua M. Bingcang (second from the left) led the official signing of a memorandum of agreement (MOA) with the Manila International Airport Authority (MIAA) for the disposition of the 61-hectare Ninoy Aquino International Airport (NAIA) Terminal 3. Also present during the event were BCDA Chairperson Atty. Hilario B. Paredes (top left), MIAA General Manager Eric Jose Castro Ines (second from the right), and Senior Assistant General Manager Ma. Lourdes SJ. Reyes (top right). BCDA photo

The Bases Conversion and Development Authority (BCDA) signed a memorandum of agreement (MOA) with the Manila International Airport Authority (MIAA) for the disposition of the 61-hectare Ninoy Aquino International Airport (NAIA) Terminal 3 property amounting to Php48 billion.

Under the new MOA, BCDA secured an increased annual lease payment of Php489 million, from the prior Php180 million. The MOA also grants MIAA a three-year option period to decide whether to purchase the 61-hectare property for Php48.89 billion or continue leasing it from BCDA.

“This agreement is a win-win for the government, as it enables BCDA to contribute more to the state coffers, while helping MIAA ensure uninterrupted air traffic flow through this critical gateway,” said BCDA President and CEO Joshua M. Bingcang. “This serves as a vital public service contribution that will ultimately lead to the development of NAIA.”

Engr. Bingcang underscored that the significant increase of payments provides a substantial boost to government revenue, enabling BCDA to contribute more to the national coffers. “This aligns seamlessly with BCDA’s mandate to drive economic growth through strategic and impactful development initiatives,” he added.

Meanwhile, MIAA General Manager Eric Jose Castro Ines highlighted the strategic importance of the disposition for the future of the Philippine aviation and airline sectors.

“Through this lease-to-own agreement between the MIAA and the BCDA, we are taking a crucial step towards securing a long-term development of NAIA Terminal 3. By transitioning from a leaseholder to a rightful owner, MIAA gains full control of the land, allowing us to plan, expand, and modernize the terminal without external limitations,” he said.

Should MIAA exercise its option to purchase, a down payment of Php10 billion, less the total cumulative annual payments already remitted, will be required. The outstanding balance will accrue interest at an annual rate of 5 percent, reflecting a reasonable return on investment for the government.

BCDA has likewise structured a 15-year payment plan, comprising equal semi-annual installments, which approximate Php3.74 billion annually.

This potential acquisition would allow MIAA to secure ownership of the land and infrastructure, enabling them to make substantial and lasting investments in the airport’s development, modernization, and expansion, thereby enhancing its capacity to serve the ever-growing demands of both domestic and international air travel.

During the first quarter of 2024, NAIA Terminal 3 handled significant passenger traffic, processing 1.7 million international passengers across 7,700 flights and 1.5 million domestic passengers across 8,200 flights.

Also present during the MOA signing were BCDA Chairperson Hilario B. Paredes, MIAA Assistant General Manager Ma. Lourdes SJ. Reyes, and BCDA Executive Vice President Gisela Z. Kalalo.

Pursuant to its mandate under Republic Act 7227 or the Bases Conversion and Development Act, the BCDA transforms former military camps into centers of economic growth, generating income through disposition proceeds from sale, lease, and joint venture, as well as concession fees and other receipts.

Portions of these proceeds are remitted to the Bureau of the Treasury through dividends and contributions to the Armed Forces of the Philippines and other beneficiary agencies. A share of the earnings are also used to fund the BCDA’s infrastructure projects to help strengthen and boost the competitiveness of its economic zones. ###