Philippines is striving to be one of the gambling rulers in Asia and the Solaire Resorts and Casino are trying to help this dream come true.
The luxurious complex began its operation in 2013 and just recently completed the next phase of its development, part of the billion dollars four planned integrated resorts of the Entertainment City at Manila Bay.
Bloomberry Resorts, which runs Solaire, recently released its 2013 full year results and the prospects are not too optimistic. Forbes reported the figures announced by Bloomberry and the loss of Solaire for the past almost one year was around $6 million.
It is interesting that Bloomberry accused the consultant Global Gaming Asset Management’s “mistakes and inefficiencies” for the negative results and fired in the second half of 2013, accompanied by several charges.
Afterwards, Thomas Arasi, the former Marina Bay Sands CEO, was hired as president and COO of Solaire complex.
The gross gaming revenue of Solaire was only $333 million for the last year, still the 4th quarter’s GGR came at $125 million, which was almost the same for Resorts World Manila.
City of Dreams Manila has a long way to go before turning into a true factor on the Asian gambling market
• Solaire Resorts and Casino in the Philippines operates since 2013
• The 2013 financial results of the big players in the country are not impressive
• City of Dreams Manila will aim at big international players
RWM started its operations in 2009 and was the first integrated resort in the Philippines, enlarging twice the size of the gaming market, operating under Philippine gambling laws.
The real Philippine market can be correctly read through the 2013 figures provided by RMW, according to Forbes. The operating profit of the resort fell 38.1% and the net profit fell 59.3%, however the gaming revenue rose 6.9% to $671 million.
It seems that one of the real reasons for the operating profit fall was the fact that the promotion expenditures rose by 50% and reached $57 million, because of the competitor’s Solaire opening.
Additionally, that last year was also not particularly successful for Pagcor, the government owned operator, which reported that its revenues fell 8.9%. It had to close one of its casinos in Manila last year and there are also realistic plans to close another one this year, which means that Pagcor will be left with only two full fledged casinos in Manila.
Solaire has more work to do
The newest player on the Philippine market Solaire provides excellent atmosphere for casino lovers, but it’s far from its complete version, as numerous of the resort facilities are not ready yet. There is still a large portion of the $1.2 billion investment, which needs to be used.
Phase 1A of the resort, which is scheduled to open late in 2014, will include additional 300 rooms (bringing the total up to 800), fancy night club, shopping mall and theater, turning it into an actual integrated resort.
City of Dreams ambitions
The City of Dreams Manila, which is a partnership between Melco Crown Entertainment and Belle Corp, run by Henry Sy, the Philippines richest man, and his family, is expected to enter the market as the second Entertainment City IR later in 2014.
One of the aims is to attract rich foreign players and given the relatively low VIP tax rate of 15%, which for comparison is 39% in Macau, will mean that the revenue in the Philippines will be more profitable, even when split between the two partners.
Another goal of City of Dreams Manila is to create remarkable international profile, which will be achieved with the signature Crown Towers hotel and Asia’s first Nobu Hotel (named after the iconic Japanese chef Nobu Matsuhisa).
Gambling specialists expressed their opinion for the gambling news that City of Dreams Manila will attract serious number of foreign players in Manila. However, it will take much more to become a serious factor on the highly competitive Asian market.
For a start, Entertainment City has to develop all four resorts as well as bay front walkway and Manila themed garden walk.
There is also always the Macau factor, which remains strong having in mind that six new resorts are planned to open by 2019. As for Manila, the future of Entertainment City doesn’t go beyond City of Dreams and Solaire at the moment, which makes the complete picture unclear.