Infrastructure woes hinder Manila gaming

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Airportterm1bThe much-anticipated $1.2-billion Solaire mixed entertainment complex christened a new era for Philippine gaming on March 16 with its $1 million opening, the first of four enormous casinos on Manila Bay. Yet while the industry is expected to competitively cut into the profits of Singapore and Macau with flashy playgrounds for high rollers, significant hurdles remain at the ground level in the short term.

Basic infrastructure upgrades are necessary to adequately shuttle tourists from the poorly planned Ninoy Aquino International Airport (Naia) to Manila Bay’s Entertainment City, a development with an estimated price tag of $4 billion that will include ventures from Bloomberry Resorts, SM-led Belle Corporation, Resorts World Manila and Tiger Entertainment.

“One of the big challenges for the gaming industry is airport infrastructure,” Nisha Alicer, senior equity analyst at DA Market Securities at the Philippine Stock Exchange observed.

“Another airport in the region is needed to handle more tourism arrivals and people are speculating where that may be,” she added.

Although Naia sits just three kilometers away from Entertainment City, traffic congestion brings motorists to a crawl that makes the voyage last as long as 30 minutes.

Relief is on the way, but not until 2014 when the new airport – Ninoy Aquino International Airport Terminal 3 – will be fully operational.

The Entertainment City, a state-owned project by Philippine Amusement and Gaming Corporation (Pagcor), is also due to benefit from an elevated expressway that will eventually connect with the city’s international airport by 2015 under financing geared into place by the government’s Public-Private Partnership programme.

“Belle and the other licensees are supporting the Naia Expressway project with $519 million in soft financing to ensure the smooth arrival and departure experience of our visitors,” Willy Ocier of Belle Corporation told the Philippine Inquirer.

Despite the evident uphill battle the industry faces, among allegations that a smear campaign is being conducted by rival casinos in the region to take down Japanese gaming tycoon Kazuo Okada, one of the casino owners, voices at the local bourse remain bullish.

“Growth in gaming is just starting [in the Philippines],” said Alicer. “You have to create a critical mass and then this will start the ball rolling.”

This weight and volume could come by 2016, when conglomerate Alliance Holding opens the fourth and final casino, Resorts World Bayshore, a $1.1-billion project that will be thrice the size of Resorts World Manila located across from NAIA Terminal 3 and be funded with internally generated cash, a company spokesperson told media.

“The Philippines is a frontier market, but could become a Singapore in the gaming sector. It’s a growth market that people are looking at for gaming,” Alicer added.

The gaming industry, although blamed for crime, is hoped to catalyse positive knock-on effects to the already robust Philippine economy, with Pagcor adding at least 40,000 jobs in the entertainment and leisure sectors, as well as the construction industry.

According to a Pagcor chief representative, only 7.5 per cent of the gaming city will be casinos, with the rest of the sites devoted to hotels and other high-end entertainment.

Managed by Philippine port operator billionaire Enrique Razon, Solaire has 300 gaming tables, 1,200 slot machines and seven restaurants. The building also has 500 hotel rooms and 2,000 parking spaces.

 

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Reading Time: 2 minutes

The much-anticipated $1.2-billion Solaire mixed entertainment complex christened a new era for Philippine gaming on March 16 with its $1 million opening, the first of four enormous casinos on Manila Bay. Yet while the industry is expected to competitively cut into the profits of Singapore and Macau with flashy playgrounds for high rollers, significant hurdles remain at the ground level in the short term.

Reading Time: 2 minutes

Airportterm1bThe much-anticipated $1.2-billion Solaire mixed entertainment complex christened a new era for Philippine gaming on March 16 with its $1 million opening, the first of four enormous casinos on Manila Bay. Yet while the industry is expected to competitively cut into the profits of Singapore and Macau with flashy playgrounds for high rollers, significant hurdles remain at the ground level in the short term.

Basic infrastructure upgrades are necessary to adequately shuttle tourists from the poorly planned Ninoy Aquino International Airport (Naia) to Manila Bay’s Entertainment City, a development with an estimated price tag of $4 billion that will include ventures from Bloomberry Resorts, SM-led Belle Corporation, Resorts World Manila and Tiger Entertainment.

“One of the big challenges for the gaming industry is airport infrastructure,” Nisha Alicer, senior equity analyst at DA Market Securities at the Philippine Stock Exchange observed.

“Another airport in the region is needed to handle more tourism arrivals and people are speculating where that may be,” she added.

Although Naia sits just three kilometers away from Entertainment City, traffic congestion brings motorists to a crawl that makes the voyage last as long as 30 minutes.

Relief is on the way, but not until 2014 when the new airport – Ninoy Aquino International Airport Terminal 3 – will be fully operational.

The Entertainment City, a state-owned project by Philippine Amusement and Gaming Corporation (Pagcor), is also due to benefit from an elevated expressway that will eventually connect with the city’s international airport by 2015 under financing geared into place by the government’s Public-Private Partnership programme.

“Belle and the other licensees are supporting the Naia Expressway project with $519 million in soft financing to ensure the smooth arrival and departure experience of our visitors,” Willy Ocier of Belle Corporation told the Philippine Inquirer.

Despite the evident uphill battle the industry faces, among allegations that a smear campaign is being conducted by rival casinos in the region to take down Japanese gaming tycoon Kazuo Okada, one of the casino owners, voices at the local bourse remain bullish.

“Growth in gaming is just starting [in the Philippines],” said Alicer. “You have to create a critical mass and then this will start the ball rolling.”

This weight and volume could come by 2016, when conglomerate Alliance Holding opens the fourth and final casino, Resorts World Bayshore, a $1.1-billion project that will be thrice the size of Resorts World Manila located across from NAIA Terminal 3 and be funded with internally generated cash, a company spokesperson told media.

“The Philippines is a frontier market, but could become a Singapore in the gaming sector. It’s a growth market that people are looking at for gaming,” Alicer added.

The gaming industry, although blamed for crime, is hoped to catalyse positive knock-on effects to the already robust Philippine economy, with Pagcor adding at least 40,000 jobs in the entertainment and leisure sectors, as well as the construction industry.

According to a Pagcor chief representative, only 7.5 per cent of the gaming city will be casinos, with the rest of the sites devoted to hotels and other high-end entertainment.

Managed by Philippine port operator billionaire Enrique Razon, Solaire has 300 gaming tables, 1,200 slot machines and seven restaurants. The building also has 500 hotel rooms and 2,000 parking spaces.

 

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