CAPEX in Integrated Gaming Resort Raised to USD 2.3 billion

Feb 2019

Megaworld Corporation, the Philippines’ largest developer of integrated urban townships, announced that it is raising its capital spending budget to PHP 64 billion (USD 1.2 billion) over a period of 10 years in the 31-hectare Westside City, an upcoming integrated gaming resort in the 8 km Las Vegas-like gaming and entertainment complex, Entertainment City along Manila Bay. This is an increase of PHP 54 billion (USD 1 billion) over the amount allocated in 2015, bringing the total investment in the complex to  PHP 121 billion (USD 2.3 billion), the remainder coming from the Travelers International Hotel Group Inc., the developer and operator of the Resorts World Manila . The surge in capital expenditure will mostly go to the expansion of residential and hotel projects within the township. 

To benefit from the opening of Westside City’s casino complex in 2021, Megaworld is set to build two new homegrown hotel brands in Westside City. These are the 529-room Kingsford Hotel and the 685-room Grand Westside Hotel, which will be conveniently linked to the casino complex and will have excellent views of Manila Bay.

Presently, Westside City has approximately 4,000 residential inventory units worth approximately PHP 50 billion (nearly USD 1 billion). Initial work began in January and is expected to be completed in January 2023. Aside from casinos and residential and hotel units, Westside City will also have a luxury mall as well as a wide array of leisure and entertainment facilities.

Aside from a strong property demand, the Philippines had various casino resort openings in recent years, with majority of the investments in Entertainment City. Consequently, gaming has contributed a huge chunk to the government’s revenues, with gross gaming revenue (GGR) estimated to reach PHP 217 billion by 2019 (USD 4 billion) and record a yearly increase of 13%. GGR is the net difference between all bets made in the local gaming industry and all the winnings paid out to players.

The sources of the Philippines’ rising gaming revenues are from a strong domestic market and foreigners who are enticed by the country’s openness to junket system and proxy betting, which the Philippines cashed in on when the world’s biggest gaming city, Macau put industry restrictions in place in 2014. Though the junket system and proxy betting have attracted foreign gamblers, they have also been scrutinized as channels for money laundering.

(Sources: Megaworld, Entertainment City,  Business Mirror, Philippine Star, Manila Standard)

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