Port magnate to build 12-ha casino complex
Bloomberry Resorts Corp., operator of Solaire Resort & Casino owned by businessman Enrique Razon, will build a 12.2-hectare integrated resort, tourism and casino complex on Muui Island in South Korea in line with its objective to establish the Solaire brand in the region.
In a disclosure to the stock exchange, Bloomberry said it has signed four sales agreements with various land owners for the purchase of an aggregate 12.2 hectares on Muui Island within the Incheon Free Economic Zone.
Bloomberry committed $1.2 billion to develop the 8.3-hectare Solaire complex. The much larger Muui development at 12 hectares can easily cost over $2 billion. Bloomberry said it will announce the development cost later.
Muui Island is visible from the Incheon airport. It measures 5.2 kilometers long and 4.5 kilometers wide and has two beaches frequented by tourists.
This is the first time a homegrown hotel and casino operator will branch overseas with a major project consisting not only of entertainment facilities but also mixed-use developments.
The company said the transaction and the project will be under its South Korea-based unit Solaire Korea Co., Ltd.
No further details were given and officials were not available for comment as of this writing.
Meanwhile, AB Capital Securities Inc.’s Alexander Adrian Tiu said Solaire’s expansion overseas “was in sight after Razon announced he wanted to establish Solaire as a brand in the entertainment sector.”
“Razon has said years ago that he wants to establish the Solaire brand, unlike its two other homegrown casino competitors [SM Group’s Henry] Sy and [Alliance Global Group Inc.’s Andrew] Tan who are more concentrated in the property sector,” Tiu said.
Besides Solaire, the two other homegrown casino players in the country are the Sy-led Premium Leisure Corp., operator of the soon-to-open City of Dreams Manila, and Tan’s Travellers International Hotel Group Inc. that manages Resorts World Manila and Resorts World Bayshore.
“I think, for now, there are already a lot of casino players in the country—homegrown or not. Casino is about location. And who would have an idea what will the next administration contribute to the sector? It’s better to diversify. If the gaming sector here grew weaker, which is unlikely as of now, then Solaire will have a fallback in Korea,” Tiu said.
Besides the three Filipino casino operators, Japanese gaming tycoon Kazuo Okada is also building The Manila Bay Resorts within the Bagong Nayong Pilipino Entertainment City complex in Paranaque City. The Okada Group development will be handled by Tiger Resorts and Entertainment Inc., a subsidiary of Okada’s Universal Entertainment Corp.
Tiu said Bloomberry’s South Korea branch out will be “positive” for the company’s business and stocks overall as it will have a new source of revenue outside of the country.
He also noted that Korea is a good location and is an entertainment hub as more and more Chinese gamblers are going to Korea.
Asked if there are risks ahead, Tiu said “there will be pre-operations losses at the start. But as long as the gaming market in Asia remains strong and China continues to grow, then there’s nothing to worry about.”
“It will be good for Bloomberry as long as they partner with people with a lot of experience [in international casino operations],” Tiu said.
Bloomberry’s stocks shot up as high as P13.46 in intraday trade on Tuesday from P12.88 last Monday before closing at P13, up by 0.93 percent.
Bloomberry booked P3.3 billion net profit in the first nine months of 2014, turning around from a net loss of P868 million in the previous year on Solaire’re full-swing realization of revenues since its opening in 2013. The company’s reported revenues of P22.4 billion, up 127 percent from P9.9 billion a year earlier.
Formerly Active Alliance Inc., Bloomberry was incorporated in 1999, engaged in the development and operation of integrated resorts, casino, entertainment and tourism complex Solaire Resort & Casino. It is owned and led by ports magnate Enrique Razon, who also owns International Container Terminal Services Inc.