By Lawrence Agcaoili

State-run pension fund manager Government Service Insurance System plans to transform Puerto Azul Beach Hotel in Ternate, Cavite into a world-class condominium hotel.

Winston Garcia, GSIS president and general manager, said in a statement that the conversion of the 340-room hotel, closed down in 1995, was part of the pension fund?s efforts to maximize the return of its assets.

?We envision it to be a condotel and we are going to set up a condominium corporation to unitize the property. The units will be tied with golf shares at the Puerto Azul Country Club, which means that if you buy a unit, you also acquire shares at the golf club,? said Garcia.

The 26-hectare Puerto Azul Beach Hotel is inside the 3,300-hectare leisure complex, known as the Puerto Azul Beach and Country Club. It is owned and developed by Ternate Development Corp. of the Panlilio family in the late 1970s and features various sports and recreational facilities, including an 18-hole golf course.

Garcia said GSIS agency had signed a memorandum of agreement with Ternate Development director Jose Marcel Panlilio on Feb. 11 that paved way for the development of a condotel project.

Garcia said the agreement gave GSIS a perpetual right-of-way at the Puerto Azul Beach and Country Club minus community dues.

The pension fund manager, according to Garcia, took over the hotel in 2007 after Ternate Development failed to settle its P92-million loan that was used to finance the construction of the 17-building hotel.

The property is covered by a 25-year, lease-purchase agreement with the GSIS.

The Panlilios also own publicly listed Boulevard Holdings Inc. that operates the Grand Boulevard Hotel along Roxas Boulevard. The hotel was taken over by the Manila City Hall after it failed to settle unpaid real estate taxes.

The proposed condotel project in Puerto Azul is the latest property venture of the pension fund manager.

It earlier tied up with San Miguel Properties Inc. to put up a P1.7-billion ?service apartment-type hotel? located beside Greenbelt 1 in Legaspi Village, Makati City and comparable with the Four Seasons Luxury Hotel in Hong Kong.

Under the joint venture agreement, the GSIS and San Miguel Properties will have a 50-50 percent sharing with regard to equity and income distribution to be generated by the hotel once it starts commercial operations in January 2011.