GGRAsia – Pagcor to auction land where Manila’s Solaire stands

Pagcor to auction land where Manila’s Solaire stands

Nov 10, 2017 Newsdesk Latest News, Philippines, Top of the deck

State-run casino operator and regulator the Philippine Amusement and Gaming Corp (Pagcor) is launching an auction to sell two parcels of land in the country’s capital Manila where casino resort Solaire Resort and Casino stands.

The minimum bid price for the combined plots is PHP37.23 billion (US$726.6 million), to be paid in cash, according to the auction announcement, published on Pagcor’s official website on Wednesday.

The two parcels of land have a combined area of 160,359 square metres (1.73 million sq feet).

Philippines-based Bloomberry Resorts Corp – the owner and operator of Solaire (pictured) – is however entitled to match the highest complying bid for the two plots. The auction announcement says that Solaire’s lease agreement allowing it to occupy the land – contracted on behalf of Bloomberry unit Sureste Properties Inc – is in force up to July 2033 and “is extendible for another term under certain conditions”.

The document states that the current lease agreement between Pagcor and Sureste “shall be binding on the winning bidder”. It adds: “As such, the lessee’s security of tenure shall be respected and guaranteed.”

The auction announcement does not feature more detail on the lease contract between Pagcor and Sureste, namely the rent currently charged to Sureste.

Prospective bidders must be Philippine nationals or otherwise authorised by law to acquire real estate in the Philippines. In case of a corporation or partnership, at least 60 percent of its capital must be owned by Philippine nationals.

Pagcor provided no reason in the announcement regarding why it was selling the two plots of land.

Interested parties should submit their bids on November 27, 2pm (local time). Bids will be opened on that afternoon. For the auction to be considered valid, a minimum of two bids must be submitted.

The terms included in the announcement state that the land “is to be utilised for the purpose of developing and maintaining thereon a world-class integrated resort”. The area “serves as an integral part of the Pagcor Entertainment City project”, it is added. It is also clarified that “ownership of the property does not confer the winning bidder the right to operate gaming facilities”.

Entertainment City is an area earmarked by Philippine authorities to become a casino district, and meant to emulate the success of Macau’s Cotai district. It currently features three casino resorts: Solaire; City of Dreams Manila, operated by a unit of Melco Resorts and Entertainment Ltd; and Okada Manila, by Japanese gaming conglomerate Universal Entertainment Corp.

Philippines casino operator Travellers International Hotel Group Inc – a venture between local conglomerate Alliance Global Group Inc and Hong Kong-listed Genting Hong Kong Ltd – is also developing a casino resort in Entertainment City, to be called Westside City Resorts World.

Bloomberry reported net profit of approximately PHP1.86 billion for the three months ended September 30, the company said earlier this week. Profit was up 31.3 percent in year-on-year terms. The strong increase in third quarter profit was mainly due to operations at Solaire, where net income increased by 45.9 percent compared to the prior-year period to PHP1.96 billion.