Revival of Manila tram system eyed
A consortium led by Greenergy Holdings Inc. is keen on investing close to $500 million to build a tram system in the city of Manila along a 10-kilometer stretch of Roxas Boulevard’s service road, the same route plied by the old street tram in the early 1900s.
In an interview at the sidelines of Philippine Infradev Holdings Inc.’s stockholders meeting, Greenergy chair Antonio Tiu said Greenergy has submitted a letter of intent (LOI) to the local government unit of Manila to build the tram under a joint venture agreement.
Greenergy will spearhead this tram consortium while Philippine Infradev will focus on its Makati subway project. Ultimately, the tram system is seen to feed volume into the upcoming subway.
Subject to approval from the local government, the Manila tram will run from Smokey Mountain in Tondo to Hospital ng Maynila on Quirino Avenue. But if the Pasay City government will be amenable, Tiu wants to extend the tramway all the way to the Ninoy Aquino International airport.
Right now, it is only an LOI to commence feasibility [study],” Tiu said.
A tramway usually has a station for every kilometer, Tiu said. “There’s no real estate development, so we’re counting on the fare. But that’s a feeder of the Makati subway,” he said.
Tiu estimated that the cost to build per station would be less than $50 million. “It should [cost] even less than $500 million for the entire stretch of more than 10 kilometers,” he said.
Since this is an above-ground mass transportation system, Tiu said this project could be executed quickly.
Typically, Tiu said the private sector partner would be given a 25-year concession renewable for another 25 years, but the terms of the joint venture agreement would still be subject to negotiations.
In the case of the city of Manila, Tiu said the local government unit was keen on reviving the old tramway system using the same alignment along Roxas Boulevard.
“Before we were born, there used to be tram at the service road of Roxas Boulevard,” Tiu said.
Trams, which are usually powered by electricity from wires above it, remain a popular public transportation system in many urban cities across the world.
Insufficient mass transportation has always been blamed for the traffic gridlock in Metro Manila. But for the group of Tiu, this is an opportunity to present alternative transportation solutions to various local government units.
Greenergy, which is currently valued by the stock market at P4.6 billion, has refocused from semiconductor manufacturing to renewable energy and other green businesses. Among the businesses being considered for acquisition or investment are those in the areas of agriculture, agritourism, real estate development, banking and finance, and information technology.
Through Philippine Infradev, Tiu recently sealed a separate joint venture agreement with the city of Makati to build a 10-kilometer subway system that is envisioned to eventually expand to other cities. The Makati subway is targeted to be completed by 2024 or 2025.
Most subway systems elsewhere in the world do not make money and in some places are even subsidized by the government, except for Hong Kong and Singapore, which earn money from the property developments in the stations. This is the same model eyed by Tiu, who expects to build about 6.4 million square meters of leasable space along various stations within the next 15 years.