Bloomberry Resorts owner Enrique Razon has confirmed the company will start work on its second casino in the Philippines next year with a P1.9bn development in Quezon City following a smilar model to its first resort; Solaire.
The announcement of casino development in Quezon City, the most populous city in the Philippines and one of the cities that make up Metro Manila has sparked call sof over saturation of the market and for government to stop the spread of casino resorts.
Those calls came from rival operator Belle Corp, which owns City of Dreams in Manila Bay along with Melco Entertainment.
Bloombery’s newly proposed casino is set to be built on Vertis North, Quezon City Central Business District, on land that Bloomberry Resorts bought via its hotel and resort development arm Sureste Properties Inc. (SPI). It was bought from the National Housing Authority (NHA) last year.
Mr. Razon confirmed: “We will probably start next year. It would be more similar to Solaire. There may be some mixed-use because there is no height restriction. There will be a casino. However, we note that these plans are subject to relevant regulatory and government approvals.”
Solaire opened in 2013, becoming the first casino to open in Entertainment City in Manila Bay. In its most recent financials, Bloomberry posted a net loss of P3.375bn for the whole of 2015, a reversal from the P4.072bn net profit following ‘large increases’ in accosts and loans.
The operator stated: “The main drivers of this year’s loss were the large increases in depreciation and amortization from Sky Tower as well as higher interest expenses from additional loan drawdowns made during the year.
Mr. Razon added: “During the year in review, we accomplished much, refurbishment and subsequent re-opening of our first overseas property and the start-up of our first Philippine expansion, the Sky Tower. These projects may have taken a toll on earnings, but were nevertheless essential to ensure continued growth for the company. As shown by the steady increase in gaming revenues, we are confident that these projects will soon add to our revenue stream.”
Revenues actually increase by seven per cent to P34.356bn. The company is also planning investments in Korea and Argentina but it is the second casino in the Philippines that has caused concern for rival operators.
Belle Corp’s Vice Chair Willy Ocier believes the existing casino infrastructure at Entertainment City should be protected from further competition.
“We spent more than $1bn on City of Dreams,” he said. “If the government allows smaller casinos, here, there, everywhere, it defeats the purpose of why we are here, an integrated casino.”
Mr. Ocier believed that regulator Philippine Amusement and Gaming Corp. should ‘direct all traffic to Entertainment City.’
“That’s where the infrastructure is concentrated,” he added. “I don’t mind competing in that environment where casinos are together. People will jump from one casino to another. We will also have to make the adjustment in terms of our projections and strategies if they are allowed to put up a casino in Quezon City.”
Belle meanwhile announced revenues of P5.2bn, up 64 per cent with profit of P1.3 billion, representing an increase of 29 per cent.
A much smaller casino is set to open at Clark Freeport Zone, Pampanga, on Luzon Island, next week. Midori Clark Hotel and Casino will open with 12 gaming tables and 140 slots, rising to 39 tables and 160 slots.
Owner BB International Leisure and Resort Development Corp said that the grand opening will be held later in the summer for the property which will be spread across 9,900 square metres with 111 hotel rooms, a ballroom, five eateries, a spa, gymnasium, swimming pool, mahjong rooms, and a karaoke venue.
It could be the first of a wave of new casinos. PAGCOR considering opening the market up further with new provincial casino licences potentially up for grabs with Cristino Naguiat, Chairman of PAGCOR, saying recently he was ‘open to casinos built outside Manila.’
Jonathan Ravelas, Chief Market Strategist at BDO Unibank, said: “Operators in Entertainment City will have to be on their toes because if they are complacent it’s not impossible that some of the traffic will go to these provincial casinos if the properties are world class.”