By Daina Beth Solomon
MEXICO CITY, Dec 20 (Reuters) - Mexico's president said on Thursday that he plans for the military to build an urban development in the capital worth up to $1.5 billion, dashing the chances for private firms to swoop in on one of Mexico City's last undeveloped swaths of land.
President Andres Manuel Lopez Obrador said he is considering a project set on 74 acres (30 hectares) of a much larger site in an affluent residential zone of central Mexico City.
"It's not going to be a private real estate company, it's not a private business. It's the government itself, in this case the secretary of defense, that's going to carry out the urbanization," he told a news conference.
Lopez Obrador, a leftist, has often lashed out at what he calls the "neo-liberal" practices of past administrations that he said benefited the business elite over average citizens.
The former government took steps to sell the entire site, a military base totaling 310 acres (125 hectares), Reuters reported in February. It put plans on hold after local residents opposed the possible transformation of a largely verdant site into urban development.
Lopez Obrador said 173 acres (70 hectares) would be set aside for a public park as an expansion of Mexico City's lush Chapultepec forest. He did not provide details on the type of project the military could develop, but said it could net up to 30 billion pesos ($1.5 billion).
Defense Secretary Luis Sandoval said in a speech earlier this month that the armed forces planned to build upscale housing on the site.
"This area is an area that's very expensive by square meter, it's a residential area, they're exclusively luxury apartments, and throughout this whole parcel this type of housing is going to be built," he said in the speech, which was cited in an official document dated Dec. 11 and published by local media.
Funds from the project's sale would be used to build facilities for about 85 battalions of a new national guard, Sandoval said.
Lopez Obrador also said on Thursday that the military will expand an airport in the town of Santa Lucia north of Mexico City.
The site will partially replace a $13 billion airport in Mexico City, intended to be built by private firms, that Lopez Obrador decided to scrap.
($1 = 19.8741 Mexican pesos) (Reporting by Daina Beth Solomon Editing by Leslie Adler)