Travellers International Hotel Group Inc has confirmed it is delaying its casino project for Entertainment City in the Philippines capital Manila.
“The company confirms that it has sought and secured the approval of the Philippine Amusement and Gaming Corp (Pagcor) for a fourth quarter 2020 completion schedule,” Travellers said in a Monday filing to the Philippine Stock Exchange.
It said the move aimed “to help preserve the Philippine gaming industry by allowing the growth of gaming demand to catch up and match the rapid growth of gaming supply in light of the operation of the integrated resorts in Entertainment City,” and what it termed “the gaming movements in the Asia-Pacific region”. The statement didn’t clarify the meaning of the latter point.
Travellers added – with regard to the Philippines – that it remained “optimistic in the long-term tourism and gaming prospects of the country and is committed in growing both its gaming and non-gaming offerings.”
Company president and chief executive Kingson Sian had said on Friday – as quoted by Reuters – that the Entertainment City project could get postponed due to oversupply in the casino sector.
The original schedule for the scheme – Travellers’ second gaming development – was for a 2018 opening.
Travellers is a venture between Philippines-based Alliance Global Group Inc and Genting Hong Kong Ltd. The firm operates the Resorts World Manila casino resort (pictured) in the Philippines capital.
The company said last month its casino gross gaming revenue (GGR) for the first quarter of 2016 declined 18.1 percent year-on-year to approximately PHP5.57 billion (US$120.1 million).
According to brokerage CLSA Ltd, Resorts World Manila has been losing market share to casino resorts in Entertainment City.
The two operational casinos in Entertainment City are Solaire Resort and Casino, from Bloomberry Resorts Corp, which opened in March 2013; and City of Dreams Manila, operated by a unit of Melco Crown Entertainment Ltd, which opened officially in February 2015, following a December 2014 soft opening.
Other licence holders for Entertainment City include Travellers; and Universal Entertainment Corp, which aims to open its Manila Bay Resorts project by the end of 2016.
Concern about possible oversupply of casino venues in the Philippines is not a new sentiment among investors in Entertainment City. The vice-chairman of Belle Corp, an investor in the City of Dreams Manila scheme, said in April that the country’s government should control the expansion of the casino industry beyond Entertainment City.
Also in April, brokerage Daiwa Securities Group Inc said there were questions as to how quickly demand for casino gaming in Manila would grow relative to the increasing supply of venues.
Travellers is currently expanding the facilities at Resorts World Manila, located next door to Manila International Airport. Phase two involves the Marriott Grand Ballroom, a meetings and conventions facility, that formally opened in July 2015. It also includes the expansion of the existing Marriott Hotel Manila, with the completion of phase two due in the second half of 2016.
Phase three consists of two new hotels – the Hilton Manila and the Sheraton Hotel Manila – as well as an extension of Maxims Hotel and a new gaming area. It is expected to be completed by the end of 2017, according to previous company filings to the Philipine Stock Exchange.
There are also plans for a phase four, featuring more hotel rooms and retail space.
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”Assuming that our [Tigre de Cristal] phase two project and the other future operators’ development plans remain on track, we may see the benefits of a ‘cluster’ effect [in the Primorye Integrated Entertainment Zone] as early as 2021”
Summit Ascent, lead developer of Tigre de Cristal