Phl on verge of a casino boom
The Philippines is on the cusp of a casino boom with more foreign firms placing their bets on the Southeast Asian nation that has attracted increasing numbers of the wealthy overseas high rollers and big spenders amid China’s crackdown on corruption and slowing economy.
US-based Sino-American Gaming Investment Group and Macau Resources Group Ltd. recently announced they were in talks with Philippine state gaming regulators on the possibility of building two new resort-destination casinos outside Metro Manila with an estimated investment of as much as $1 billion.
One of the casinos would rise in Cebu while the other near a proposed airport in Napayawan, Masbate.
Sino-American Gaming is reportedly planning to bring its hotel chain Banyan Tree Group to the Philippines to form part of its proposed casino development. The proponents are also looking to recruit the Marriott hotel group to complete the hotel component of the project.
Apart from this, Sino-American plans to tap an unidentified Las Vegas company to provide entertainment.
If the plan goes through, the Philippines will be successful in luring another global casino operator which will further heat up competition in the fast-growing gambling market.
Francis Hernando, vice-president of gaming licensing and development at the Philippine Amusement and Gaming Corp. (Pagcor), was quoted in a Reuters newswire article, saying applications in tourist areas like Cebu have high chances of securing a casino license rather than opening in the overcrowded Metro Manila, where Bloomberry Resorts’ Solaire Resort Casino, Melco Crown Entertainment’s City of Dreams Manila, and Malaysian-backed Resorts World Manila have firmly established their footprint.
Cebu was earlier mentioned as the site of future expansion of the SM Group’s gaming business.
Two more integrated casino resorts are set to open in the next few years, hoping to cash in on the Philippines’ buoyant economic growth. These include the Manila Bayshore, a joint venture between Alliance Global Group Inc. and
Malaysia’s Genting Group; and Japanese billionaire Kazuo Okada’s Manila Bay Resorts.
The downturn in Macau, the world’s largest gambling market, has benefited midsized markets such as Korea and the Philippines as Chinese gamblers flock to new casino destinations with fewer restrictions.
Last October, Caesars Entertainment Corp. signified its interest to enter the Philippine casino industry as part of its overseas expansion.
The Philippines may become the next most attractive gambling hub in Asia given its proximity to a range of key tourism markets. It earned $2.5 billion in revenues in 2014, up 16 percent from the previous year.
Macquarie Research sees the Philippine gaming industry growing 20 percent over the next three years to hit $4.8 billion.
Port tycoon Enrique Razon’s Bloomberry, the operator of Solaire Resort and Casino, posted its highest profit at the end of 2014, mainly driven by its increasingly growing junkets that bring in foreign high rollers.
Developing new markets is important for casino companies as China’s corruption crackdown puts a dent in revenues in Macau.