PAGCOR CITY- BAGONG NAYONG PILIPINO ENTERTAINMENT AND RESORT CITY
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|The Landmark Bill |
In June, PAGCOR experienced its most significant event for 2007 the passage of the Republic Act 9487 otherwise known as the PAGCOR Bill. Signed into law by no less than the President, this important piece of legislation grants the state run gaming firm a 25-Year extension to its franchise, renewable for another 25 years.
This in itsdelf is a breakthrough for the country as it signifies the growing recognition bt the government of the benefits of a legalized gaming industry.
With this, PAGCOR can now go full gear with the implementation of its multi-billion dollar tourism development project, the Bagong Nayong Philippino- Manila Bay Integrated City
People have been hearing about the entertainment cityproject invisioned by Genuino as early as 2001. However, its implementation was hampered by pending expiration of the PAGCOR franchise. But thanks to the timely approval of RA 9487, this ambitious dream is now fast becoming a reality.
The Bagong Nayon Pilipino-Manila Bay integrated City will initially cover about 85 hectares of reclaimed land in Bay City area and will be developed in various stages over the next 10 years.
It will be a fully integrated tourism zone featuring a wide array of iternational grade facilities amenities such as posh luxury hotels, convention stores, state of the art theaters, sports stadiums, restaurants, shopping centers, cultural complexes and museums, amusment parks and an Observation Tower that will be among the tallest structures of its kind in the world.
Meanwhile, the second and third phases of the project include the development of other tourism hubs in the country such as Clark in Pampanga and Cebu in the Visayas.
|Two foreign casino firms seek license from Pagcor |
By Jenniffer B. Austria
State-owned gaming firm Philippine Amusement and Gaming Corp. is finalizing the issuance of gaming licenses to two foreign operators that have expressed plans to put up casinos within the 800-hectare Pagcor City in Pasay City.
Pagcor chairman Ephraim Genuino told reporters that the issuance of the licenses would coincide with planned launching of the Pagcor City in the second quarter of the year.
Genuino declined to identify the two foreign companies but said they were among the biggest casino operators in the world.
Genuino earlier said several investors from Japan, United States, South Korea and Europe had expressed strong interest in investing in the entertainment complex.
He earlier identified the Loutraki group, one of the biggest casino operators in Europe, as one of the casino operators interested in setting up operations on the reclaimed Pagcor property in Manila Bay.
Genuino said only 5 percent of the total property would be devoted to casinos. He said a big chunk of the property would be geared for other developments such as themed park, hotels, wellness center, retirement village, residential condominiums, office developments and commercial centers.
Genuino cited that Japanese investors were interested in developing a retirement village within the area to cater to the rapidly expanding retiree market.
The project, which is estimated to cost between $10 billion and $20 billion, will be developed in three phases.
The first phase involves the construction of a hotel casino, a theme park and a casino. Projects under the phase one will be completed over the next two years.
The second phase involves the establishment of residential condominiums, resort and additional hotels and casinos while the third state covers the construction of service hospitals, retirement village and wellness center.
With the completion of Pagcor City, Genuino expects tourist arrival in the country to reach 10 million over five years. Some one million jobs will also be created from the development of the project.
Pagcor City will help the Philippines catch up with Macau, Asia’s casino capital, and Singapore, which recently allowed the two casinos.
Pagcor in 2006 registered an income of P25 billion from casino operations, almost up 10 percent from P23 billion in 2005.
|US casino operators get Pagcor license |
By Honey Madrilejos-Reyes
STATE-CONTROLLED Philippine Amusement and Gaming Corp. (Pagcor) will be issuing licenses to two US-based casino operators that will locate in Aseana Business Park’s Pagcor City in Parañaque.
In an interview, chairman and chief executive Efraim Genuino said they are about to hand out the licenses. He did not identify the companies.
“This just indicates that we are moving towards realizing the Pagcor City,” he said.
Last year, Pagcor started with the development of the first phase of Pagcor City, which consists of a resort hotel, a theme park and gaming centers.
“Our goal is to complete Phase I in two years and immediately proceed with the second phase, which would involve residential villages and casinos,” Genuino told reporters. Phase III of the estimated $20-billion project would feature a hospital district, restaurants and commercial establishments.
In a previous interview, he said it would take at least seven years to develop Pagcor City, which will occupy around 60 hectares of Aseana Park.
Pagcor, which ended 2006 with a gross income of P25.5 billion, operates 14 Casino Filipino branches, eight highly-exclusive Casino Filipino VIP clubs and three slot-machine arcades in key cities.
Genuino is convinced of the country’s potential of becoming the Las Vegas of Asia, beating the neighboring Macau, because “we have always been at the radar screen of big-time investors from all over the world.”
“We have investors from all over Europe and Asia. With the Pagcor City, our goal is to generate as much as 250,000 jobs and also promote the tourism industry of the country,” he added.
|Miracle in the making |
The international gaming industry must be abuzz with news about the new Las Vegas-style entertainment city that is expected to start rising on the Philippine horizon before the third quarter of this year. What’s amazing is that the government expects the construction of this ambitious project to be almost entirely bankrolled by the biggest gaming investors of the world.
It expects to see this big project through not only without any cash outlay on its part but also without issuing any sovereign-loan guarantee on behalf of any project proponent.
We are talking, of course, of the $10-billion Entertainment City that will be built initially on 40 hectares of reclaimed land along the Manila Bay. Bets are being placed that when completed in less than three years, this “city” would be more fabulous, and therefore more attractive, than the other state-run projects in Macau or Singapore.
Officially named the Bagong Nayong Pilipino Manila Bay Integrated City, the project—the biggest ever to be undertaken under the aegis of the state-run Philippine Amusement and Gaming Corp. (Pagcor)—is designed to triple the national government’s income from Pagcor operations to $1.5 billion annually.
But more than that, it is expected to give the economy a big shot in the arm by generating an initial 250,000 jobs for the local work force and more than triple foreign tourist arrivals by showcasing the natural charm of the country.
Pagcor chairman and chief executive officer Efraim Genuino, who conceptualized the whole project, says that two separate groups have, so far, qualified to plunk in a total of about $4.5 billion to get the building of the “city” started as soon as possible. Both investors, Genuino says, are recognized by the Nevada Gaming Commission.
It was only in September last year when Pagcor issued the official terms of reference to those who may want to be licensed by Pagcor to participate in the project. The terms of reference, by the way, are also posted on its web site (pagcor.com.ph).
Genuino says the response to the Philippine invitation has been enthusiastic, although a few of the individual investors who attended the prebidding conference held in September indicated that the $1-billion minimum investment requirement was a bit steep for them.
Genuino said: “But it’s necessary to set the ante at this level, to keep out the small investors and accept only the ones with the financial muscle for this kind of undertaking. Otherwise, how else can we be competitive with Macau or Sigapore?”
According to the terms laid down by Pagcor, applicants must have both the financial capability and the well-established experience in the hotel and gaming businesses. Big financiers are also welcome, but they must team up with experienced, reputable gaming entities to qualify.
For starters, a proponent must commit to build “a total entertainment complex” with a minimum project cost of $1 billion.
Also, “each project proponent must have a minimum debt-equity ratio of 50-percent equity and 50-percent debt, in order to assure the project’s financial viability.”
In his talk to the prebid participants, Genuino pointed out that the Philippines’ location was its biggest asset, considering that it is only a few hours away from countries such as China, which has the biggest number of outbound tourists in the world today.
The Philippines, he added, has other added attractions compared with the other gaming meccas. “Macau can offer only its casinos, but the Philippines has much more—first-class beaches and golf courses, plus other exotic tourist adventures.”
Another condition listed in Pagcor’s terms of reference provides that locators in the entertainment city must hire 95 percent of their manpower requirements from the local labor force, and that their salaries be paid in United States dollars. “This is intended to slow down the exodus of local workers,” Pagcor spokesman Dodie King explained.
Under the terms of reference, each investor’s mandate is not merely to establish a hotel-casino but “a destination that will attract not just gaming enthusiasts but also business tourists and leisure travelers…the concept must be unique [in architectural design]…key components must include theaters, exhibition halls, museums, housing for casino employees and other tourist amenities.”
Genuino, who has an outstanding marketing background, is confident the Philippines is already succeeding in selling this concept to the world, which he says is the wave of the future.
“Construction should start before the third quarter of this year,” he adds.
|PAGCOR's Bagong Nayon Pilipino Entertainment City |
To The Point
Another project under the Arroyo administration—Pagcor’s Bagong Nayong Pilipino Entertainment City Manila in Bay City, the 120-hectare Roxas Boulevard reclamation—will be up in two years or so. It is Pagcor’s answer to the $98 billion global gaming and entertainment industry in Asia, now being monopolized by Macau, Singapore, South Korea, Thailand and Malaysia. To get a slice of the pie is more than the dream of Pagcor’s chairman and chief executive Ephraim Genuino, who conceptualized the project.
The project, whose terms of reference have already been finalized after Asian, American and European gaming and entertainment giants showed keen interest, could cost from $10 billion to $15 billion.
More than a venue for world-class gaming and entertainment, Genuino’s brainchild will have theme parks, luxury hotels, residential villages, convention and sports centers, shopping malls, golf course, a hospital district, state-of-the-art theaters, race tracks, gaming centers, waste management facility, marina and a boardwalk, a cultural center and of course, the Bagong Nayong Pilipino for tourists.
This is a project I can support because gaming and entertainment is now the name of the game in fueling tourism. This has been observed in Macau, Singapore, Malaysia, South Korea and Thailand. I still believe that tourism is the country’s engine of growth.
The project aims to provide more than 200,000 jobs and boost related industries and businesses, like hotel and hospitality.
Pagcor now is the third biggest revenue-generating state-owned entity. With this project, Pagcor could well be the biggest income generator for government.
|Pagcor says $15B committed for Manila gambling complex |
BY GENIVI FACTAO
The Philippine Amusement and Gaming Corp. (Pagcor) yesterday said foreign investors had committed an initial $15 billion for the first phase of the gaming and entertainment complex, set for groundbreaking this December.
Pagcor chairman Efraim Genuino said the "Bagong Nayong Pilipino- Manila Bay Integrated City will create 200,000 jobs and will be the single biggest dollar investment in the country.
Genuino said that the government will not spend a single centavo on the complex but there are local investors who had shown interest.
Dodie King, senior managing head of the Corporate Communications & Services Department of Pagcor said there are investors from Europe and United States which plan to put up 7 hotels.
Pagcor will give investors a franchise of 25 years renewable for another 25 years.
Genuino earlier said the project will encourage more tourists and he expects that 80 to 90 percent of the revenues derived from its operations will come from tourists. The construction of the first phase of the project will end after 2 to 3 years.
Pagcor’s plan is to have 75 percent of the investment for entertainment while the 25 percent is for gaming, which follows the concept of Las Vegas.
The investors can have all the possible investments they want, as the total land area is 800 hectares. Pagcor only allows investor to come in if it has $1 billion.
|Pagcor sets $1-B ante for gaming complex |
BY RUBY ANNE M. RUBIO, Senior Reporter
INVESTORS EYEING a priority government project aimed at positioning the country as an Asian gaming haven need to pony up at least $1 billion to participate.
Recently issued terms of reference (ToR) for the Bagong Nayong Pilipino Manila Bay Integrated City — formerly called Entertainment City Manila — state that firms wishing to apply for licenses to run integrated casino-entertainment complexes must submit proposals with a minimum project cost of $1 billion, consisting of both equity and debt.
"They must have a plan to spend at least $1 billion. We feel that is an appropriate cost because it is the same amount being spent in other resorts," Pagcor spokesman Dodie King told BusinessWorld.
The floor amount, he said, would guarantee that applicants for Pagcor licenses have the financial capability to operate the facilities.
"We just want a guarantee that they will pursue the project they will put up, that is why the terms of reference calls for at least $400 million in investments to be made in the first phase of the project," he said.
The initial phase of the project involves approximately 40 hectares of reclaimed land along Manila Bay in Parañaque. Other locations in the vicinity could also qualify with Pagcor approval.
The ToR states that full implementation could boost Pagcor’s income to $1.5 billion annually from $500 million, which in turn would add to the National Government’s coffers.
Pagcor released the ToR last month, indicating that the gaming firm was ready to accept applications for permits to operate casinos and entertainment facilities.
Mr. King said that so far, seven groups from the United States, Europe and Asia have expressed interest. He declined to be more specific.
The terms of reference also require each application to be accompanied by a non-refundable manager’s check amounting to $50,000.
Applicants must also have "a well-established experience" in the hotel and gaming business.
Financial companies can apply for permits, "but will be required to engage qualified hotel and gaming operations entities [whether organizations or individuals], who have the track record in organizing and operating world-class hotel and gaming projects."
All project proponents must have a minimum debt to equity ratio of 50% equity and 50% debt to "assure the project’s financial viability."
Pagcor said the number of licenses to be issued would be flexible and would depend on the number of applicants who conform to the ToR.
Upon receipt of the license application, Pagcor will immediately review and evaluate the project. It will issue a decision within 30 days after receipt of the application.
Applicants who propose to own the land should meet the constitutional cap on ownership — that the firm should be 60% Filipino-owned.
Firms which opt to lease Pagcor-owned land may be 100% foreign-owned.
The lease period has been set at 25 years, renewable for another 25, while the annual lease rate has yet to be set.
Upon approval of the project application, the proponent must submit a bank guarantee, letter of credit or surety bond "to guarantee the completion of the project", to be secured from a "reputable firm acceptable to Pagcor".
Grant of a provisional license requires the proponent to open an escrow account of a minimum $100 million. In lieu of this, Pagcor said it will accept an actual investment of $100 million in the project at the time of the application.
Once gaming operations start, Pagcor will impose several fees in lieu of all taxes with reference to gaming revenues.
For "non-junket table and slot machine operations", these are 10% of gross revenues from "high roller" tables (those with a minimum bet of $10,000), 25% of gross revenues from "non-high roller" tables and slot machines, and 2% of gross revenues from both high roller and non-high roller tables "for the restoration of cultural heritage".
For "junket operations", the fee is 10% of gross gaming revenues.
Prospective license applicants, in submitting their concepts, must detail the company’s profile (highlighting its experience in casino development and operation); consularized company registration, articles of incorporation and bylaws; accomplished directors’ and officers’ personal history statements; organizational set-up; financial profile including audited financial statements for the last three years of operation; and bank certification on the availability of adequate credit facilities.
The business plan must address the following Pagcor objectives: boost tourism/increase influx of tourists, generate jobs, and create economic impact. The proponents must indicate the projected number of tourists, number of jobs to be created and sourced in the Philippines, and earnings for government, aside from indirect benefits and advantages.
Local hiring should be 95% for the whole hotel entertainment complex, and salaries should be in US dollars.
The business plan must also include long-term development and expansion programs, target foreign markets and marketing plan, and the positioning of complex in the region as compared to Singapore or Macau and other countries.
"The general concept is the creation of a destination that will attract not just gaming enthusiasts but also business tourists and leisure travelers as well; the concept must be unique," the Pagcor said.
"Key components must include the establishment of tourism facilities such as theaters, exhibition halls, museums, and other tourism-oriented facilities. The concept must also include staff house/s for the casino employees."
Foreign gaming firms have had discussions with Pagcor regarding the proposed Entertainment City. Among those said to have visited were Malaysia’s Genting International, which is building a $3.4-billion integrated casino resort in Singapore’s Sentosa island, US-based Wynn Resorts Ltd., and Storm International BV.
Tim S. Shiah, consultant to Wynn International Chairman Jack Binion, was reported to have said that Wynn could invest at least $500 million up to $1.5 billion for an integrated hotel-casino-resort.
Paul Michael Boettcher, chairman of Storm International B.V. which operates at least 30 casinos in Russia, has also been reported as expressing interest in the Philippines.
Pagcor’s Mr. King said ground breaking for the Entertainment City could be held before the end of the year. The project will likely be finished after two years, he added.
He said the project might expand to 800 hectares, given proposals to continue building over water.
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