To RFP Garapan Annex lot or not? That is the question


The fate of a plan to put up a request for proposal to lease out the Garapan Annex—the housing project more popularly known as Lower MIHA—will be known today during the Northern Marianas Housing Corp. board meeting.

According to corporate director Jesse Palacios, the board would decide whether to approve or disapprove the RFP.

“We already have a draft RFP in place. It’s just a matter of the board approving it and having it ready for publication,” Palacios said.

The RFP for the property has been in the works for quite some time now. The corporation first issued an RFP for the 45-unit property in 2011. The board then cancelled the RFP in 2012, citing legal issues.

“There was an RFP already issued, published and then three proposals submitted. But then we had to cancel the proposals because we had to review that public law,” Palacios said, referring to Public Law 6-34, which states that the lease of a property should be based on the outstanding obligations of NMHC.

“It’s a little bit unique because…when you lease a property it’s based on the appraised fair market value. In this case, it’s based on the total outstanding obligations of NMHC,” Palacios said.

The outstanding obligations of NMHC as of Sept. 30, 2015, is about $11 million, which is higher than the appraised value of the 40,000 square-meter lot across the Commonwealth Health Center. That includes unpaid interest and recapture receivable.

Palacios said their obligations are guarantees to other federal agencies, the biggest of which is U.S. Department of Agriculture Rural Development housing loans.

“NMHC guaranteed over 300 loans but the problem is NMHC guaranteed the loan without any funding, any actual assets,” Palacios said.

Those who would lease the land should also pay NMHC cash up front as well as give the corporation a percentage of their gross. The property cannot be divided but must be leased as a whole.

Unlike other lands, though, NMHC can lease the land for up to 55 years.

Despite these issues, Palacios said there are many who are interested in this piece of prime property in the heart of Garapan. “We have people interested in the property so I don’t think that it’s going to be a problem.”

He said there are at least five interested companies off and on island that are looking to establish different projects such as housing, a shopping mall, a medical facility, and restaurants in the property.

Frauleine S. Villanueva-Dizon | Reporter
Frauleine Michelle S. Villanueva was a broadcast news producer in the Philippines before moving to the CNMI to pursue becoming a print journalist. She is interested in weather and environmental reporting but is an all-around writer. She graduated cum laude from the University of Santo Tomas with a degree in Journalism and was a sportswriter in the student publication.

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