Macau casino junket investor Suncity Group is to open in the fourth quarter this year an operation at the Okada Manila casino resort, said banking group Morgan Stanley in a new report on the Philippines casino market, and citing a recent investor trip there.
Okada Manila (pictured) – promoted by Tiger Resort, Leisure and Entertainment Inc, a firm founded by Japanese gaming entrepreneur Kazuo Okada – had its first junket partner in the third quarter this year, which had “helped the ramp” of the property, said Morgan Stanley analysts Alex Poon and Praveen Choudhary in Sunday’s report.
“More are to join in the fourth quarter 2017, including Suncity,” said the analysts. GGRAsia had separately been given information that Suncity was shortly to have a junket at Okada Manila, although it has not been confirmed to us by the group.
Suncity Group has been described by a number of brokerages as one of the largest investors in Macau casino VIP operations when judged by monthly roll. Businesses linked to Alvin Chau Cheok Wa, the chairman of Suncity Group, are involved in two new casino projects in Vietnam.
Morgan Stanley noted regarding Okada Manila: “Hotel rooms remain a constraint with only approximately 120 operational and 90 percent of them are comped (versus 50 percent for City of Dreams Manila and Solaire), but more rooms will progressively open and [the tally will] reach 493 in the first quarter 2018.”
The bank’s analysts were referring to rooms offered either free or at a discount – or ‘comped’ in the industry’s jargon – either to junkets or to high value players; and to rival properties City of Dreams Manila, operated by a local unit of Melco Resorts and Entertainment Ltd; and Solaire Resort and Casino, developed and operated by Bloomberry Resorts Corp.
Morgan Stanley said that the new generation of multibillion U.S. dollar private-sector casino resorts in Manila were benefiting from warming ties between the Philippines and China under the Philippines’ President Rodrigo Duterte, and from a growing contribution by local players.
“Chinese visitor arrivals grew by 33 percent year-on-year in first half 2017,” wrote Mr Poon and Mr Choudhary.
“On August 17, the Philippines government granted visas on arrival to Chinese visitors (tour groups/businesspeople etc), and we think this will eventually extend to all Chinese visitors,” they added.
Referring to Entertainment City – a zone in Metro Manila designated by the local regulator, the Philippine Amusement and Gaming Corp (also known as Pagcor), for the development of a cluster of private-sector casinos – the Morgan Stanley team stated: “The NAIA Expressway completed in December 2016 has started bringing more locals from 20 kilometres [12 miles] away in the south of Metro Manila, as driving time has been cut to less than 30 minutes.”
The bank said there was a “growing cluster” of tourism venues in Entertainment City. It cited: Okada Manila, which it said was due to have a full opening in 2018; the launch of a facility from Ayala Malls – a unit of Ayala Land Inc – that it said would have a shopping centre covering 557,400 sq metres (6 million sq feet) plus 325-room hotel; and “residential projects” due to open in that district “in the next few years, driving higher local penetration”.
In early August Andrea Domingo, the head of Pagcor, said nationwide gross gaming revenue was likely to reach PHP150 billion (US$2.99 billion) in full-year 2017 – a slight year-on-year increase.
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Analyst at Roth Capital Partners