What the Makati–Infradev settlement means for the city’s subway plan

MANILA, Philippines – The Makati City government has agreed to settle its dispute with Philippine Infradev Holdings Inc. over the long-stalled Makati Subway Project, an infrastructure venture purportedly derailed by the city’s territorial loss of EMBO barangays to Taguig City.

In a special council session on January 15, the Makati City Council, led by Vice Mayor Kid Peña, authorized Mayor Nancy Binay to enter into a settlement agreement with Infradev.

On January 20, Binay formalized the settlement with Infradev, represented by Youmin Ren. The city council ratified the agreement on January 26.

The city resolutions did not disclose the cost of the agreement. Binay, however, previously said the settlement would amount to P9 billion ($160 million), on top of a $30 million (P1.7 billion) penalty for delayed payments and accrued interest.

Under the deal, Makati assumes full ownership of the subway project and all its related assets, effectively taking control of the railway enterprise.

This settlement also opens the door for Makati to seek a new investor or forge a new public-private partnership arrangement.

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The road towards this settlement agreement has been bumpy.

An earlier attempt to settle the dispute was made under former mayor Abby Binay, Nancy’s estranged sister and predecessor. Days before her term ended, Abby entered into a settlement agreement with Infradev.

Nancy, who had just assumed office at the time, flagged the deal as a “midnight settlement,” arguing that it was executed during the transition period and was legally flawed and grossly disadvantageous to the public. This prompted the Nancy-led administration to withdraw from the agreement with Infradev.

Nancy also questioned whether the city had sufficient funds to pay for the settlement. Abby disputed this, maintaining that Makati had enough resources to cover the costs without cutting programs or employee benefits.

Why the project stalled

The Makati Subway Project was thrown off course after the Supreme Court ruled that the EMBO barangays are part of Taguig City. Several planned subway stations were located in these areas.

The project, which was a brainchild of Abby Binay, had originally been slated for completion by the end of 2025. It was envisoned to be the first subway system in the country.

On August 16, 2023, Infradev sent Makati a notice citing the “significant adverse effects” of the Supreme Court ruling on the viability of the project.

On March 11, 2025, Infradev terminated its joint venture agreement with the city. The dispute was elevated to arbitration before the Singapore International Arbitration Centre.

Infradev argued that the project was “no longer economically and operationally feasible,” primarily because of the Supreme Court decision that altered Makati’s territorial boundaries.

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– Rappler.com