If all goes according to plan, in 2016 we will have a mega-complex of hotels, resorts, and casinos in a brand new strip of reclaimed land on Manila Bay, the City.
There, big money will flow in a frenzy of high stakes gambling and ‘total entertainment,’ our attempt at taking a big chunk of the fun from the little Monaco of the east. It’s that or an easy win over Las Vegas, which has been losing a lot lately. Unless, of course we botch the entire thing…
When Solaire Resort and Casino opened in March at that new stretch of reclaimed land beside SM Mall of Asia called the Pagcor Entertainment City, no less than President Noynoy Aquino led the celebration. But there was no ribbon cutting.
They weren’t saving money. Feng shui experts apparently advised them cutting ribbons was bad luck.
The budget for Solaire’s no-ribbon cutting launch was $1 million.
It was nothing. Money, at that point, was certainly no object.
Bloomberry Resorts—owned by the billionaire king of the global piyer, International Container Terminal Services, Inc.’s Enrique Razon — had already spent $750 million on the building they had launched, a slab of fine contemporary architecture with 500 rooms and several restaurants seriously vying for our first Michelin star status (and where a simple steak dinner could cost upwards of P7,000). The casino area alone is sprawling at 18,500 square meters, a quarter shy of the total floor area of the Smart Araneta Coliseum, and will have 300 gaming tables and 1,200 slot machines. It is only first phase of the project. By the time they’re through, they would have spent a total of $1.2 billion.
And this is only the first complex in the Entertainment City dream.
Pagcor’s blueprint involves filling the 100 hectares of reclaimed land with five mega-structures to the tune of $5 billion, or a minimum of $1 billion in investments for each player—money that they will come up with entirely by themselves to meet the Pagcor specs of a minimum of 800 rooms, 20,000 square meters of retail space, and a thematic attraction worth at least $20 million, in exchange for the exclusive gaming license and government incentives.
The lineup is already filled, and it reads like between them they could create their own small casino/country: Razon’s Bloomberry Resorts with Solaire, the first to open; the Belle Grand Manila Bay, a collaboration of Henry Sy’s Belle Corp. with Macau casino giants Melco Crown, now constructing; the Japanese-led Universal Entertainment Corp. has the Manila Bay Resorts, due 2015; and Andrew Tan’s Alliance Global Group and Malaysia’s Genting Group—the Travellers International Hotel Group—will have Resorts World Bayshore, which will be the last to open in 2016 (Resorts World Manila across the NAIA Terminal 3, industry insiders say, was just for practice).
This is actually a more sober version of the dream. When Pagcor unveiled the concept of a Las Vegas-like destination back in 2007, it was an ambitious 800-hectare, $10-billion plan. Even though it is now only a fraction of the original, the concept is still the same. And even more important, it’s real.
Then Pagcor head Efraim Genuino bared the new vision in a conference of gaming and leisure executives back in 2007: “The Pagcor City will have arcades, malls, hotels, wellness spas, cultural center, sports arena, and theme parks, patterned after Macau and Las Vegas. The thrust now is not casino gaming but total entertainment. In the global arena, only 25 percent of the revenues of gaming destinations such as Las Vegas come from actual gambling.”
Our own Macau. Las Vegas in the Philippines.
“We will beat Las Vegas, I’m pretty sure of that,” current Pagcor Chairman Cristino Naguiat proclaimed in an interview with a foreign press agency.
We’re getting ready for the big time.
GUTTING THINGS DOWN TO SIZE
Now this is where we put things in perspective.
And an interesting perspective is that, in terms of making money, beating Las Vegas isn’t too far-fetched.
Vegas has been losing big time, so much so that as far back as 2007, Macau has been named the top moneymaker in the global gaming industry. In a 2012 report by US paper Las Vegas Sun, it said that Macau’s 2011 gross gaming revenue was “$33.5 billion—more than five times the number that was likely generated along the once globally dominant Las Vegas strip during the same period.” By doing simple math, we know that the Vegas strip makes around $6 billion a year.
Pagcor chair Naguiat gave a projection of Entertainment City’s numbers at last year’s Asian Finance Ministers’ Investor Seminar in Hong Kong: “At full development, Entertainment City is expected to have the capacity to deliver up to $10 billion annually in gaming revenues, as well as generate over 400,000 direct and indirect jobs.” The experts seem to agree. In a February 2013 research note of financial service company, Credit Suisse, they forecast that the Philippines’ gross gambling revenue will exceed $5.6 billion by 2018, or about what Singapore made in gambling money last year.
Macau is a tastier prospect not only because a chunk of the gambling money is there, but also because we’re neighbors. High rollers will find it easier to jump tables to us.
Entertainment City knows this. At Solaire, the currency in use for high rollers is the Hong Kong dollar. In a Rappler.com report, Dennis Andreaci, Solaire’s senior VP for gaming operations, said that this is to accommodate their main VIP demographic, which is “not necessarily Chinese, but Chinese-speaking.” In the same report Solaire management estimates that VIPs can spend anywhere between P2.5 million and P50 million, to go with top-notch service that includes the use of private jets. It’s safe to say that this will soon be the standard for the other casinos to follow at Entertainment City.
But can we beat Macau?
In some ways, like how much taxes the gaming industry pays, maybe we can. “The tax rate against all gaming revenues in Macau is 39 percent, but the VIP tax in the Philippines is only 15 percent,” said Bradley Stone, president of Solaire’s gaming operator, Global Gaming Asset Management, in an interview with ANC’s Inside Business.
But looking at the Macau playground, we can’t. Yet. And it isn’t even about the $33 billion in gross revenues that, even by Las Vegas standards, is insane. It’s how they build things there.
Consider the Cotai strip. The Cotai is also land that the Macau government has reclaimed for gambling, with a size of 520 hectares. And this is just additional space. Ours would seem like a parking lot at one-fifth Cotai’s size.
Or the Venetian Macao, owned by the Las Vegas Sands.
It is the sixth largest building in the world by floor area.
It has 51,000 sq m of casino floor space, with 3,400 slot machines and 800 gambling tables. It has 3,000 suites. All of these cost $2.4 billion. At this level, our Solaire somehow feels like a mere building wing of the Venetian.
Still, Solaire’s Chief Operating Officer Michael French, in an interview with foreign news agency AFP, is right. We don’t have anything like Solaire, or an Entertainment City, in the Philippines. “What Solaire brings is an entertainment and gaming experience that doesn’t exist in the Philippines today… This raises the scale, the excitement and the…glamour.”
POSSIBLE LOSING STREAK
On to the next phase: How can we possibly bungle a plan like this?
There are many ways: corruption, bad deals, the sea reclaiming the land, other disasters natural or otherwise. But let’s pick two that seem apparent, if not imminent.
One: If the new president in 2016 changes his or her mind.
Obviously, our current president has no problem with gambling. He was at Solaire’s launch. Also, the way government sees it, gambling is just part of the package—the “entertainment” part is more important. Philippine Star reported that in his speech at Solaire’s launch the president said: “What we have here in Solaire is an entertainment hub that can be enjoyed by the whole family. Already we can envision your guests during their stay—families swimming in the pool, couples relaxing in the spa, or simply sipping on a mango shake with the Manila Bay sunset in the background.”
Dr. Neil Adrian Cabiles, assistant professor at the Ateneo de Manila’s Economics department, frames it like this:
“The target [for the completion of Entertainment City] is 2016. If they finish it by 2016, then there’s no problem.
But there are delays and if they don’t finish it and let’s just say they are 75 percent done with the project by 2016 and then you have a new president. What if that president is conservative? What if that president doesn’t like the idea of gambling?”
Second: If the church says that gambling is the devil’s handiwork and we all go to hell.
That is, of course, an exaggeration. The church, in fact, says that it does not prohibit some forms of gambling in certain situations. Here is the Catholic Bishop’s Conference of the Philippines’ 2005 statement on gambling:
“The Catholic Church teaches that ‘games of chance, or wagers are not in themselves contrary to justice. They become morally unacceptable when they deprive someone of what is necessary to provide for his needs and those of others. The passion for gambling risks, becoming an enslavement (Catechism of the Catholic Church, no. 2413).” This moral teaching does not prohibit some forms of gambling in certain situations. In consequence, it does not prohibit people or institutions, even church-related ones, from receiving benefits from such gambling. However, applying the general moral principle to the specific Philippine situation, the CBCP has deemed it necessary to state on several occasions that the form of gambling that is organized, widespread, and systemic, whether legal or illegal, is not desirable. It is creating a culture of gambling that is seriously eroding the moral values of our people.”
(We called staunch anti-gambling advocate retired bishop Oscar Cruz for his views on Entertainment City. He returned our call several days later but declined to be interviewed because we were FHM. We said we understood. He, however, allowed us to quote from a piece he wrote in his blog, ovc. blogspot.com. Part of what he wrote: “Wow, lo and behold, it is even proudly prophesied that the Philippines will be more competitive in ‘tourism and total entertainment’ all over Asia—over and above Macau. Translation: The Philippines is envisioned to be the first and foremost gambling country in the Asian region courtesy of Pagcor.”)
Gambling in Entertainment City is organized, systemic, legal (of course) and therefore, to the church, not desirable. It will erode you.
WHERE TO GET A JOB
If you work at Solaire, we’d want you to sneak us in for lunch.
The debate can go on about the economics and the morality of the Entertainment City undertaking, but we can tell you this much: the 4,000 or so employees at Solaire have few reasons to complain. And it looks to be the same for everyone else going to work at Entertainment City.
A few weeks before its grand launch, FHM was at Solaire to photograph the Solaire girls for the inside pages of the magazine. On hand to show us around was Enrique Razon’s daughter herself, Katrina, who briefly returned from studying abroad to oversee the grand opening. She invited us for lunch at their commissary.
The employees’ commissary was a huge open floor serving international buffet. Picture it: They had Western, Asian, and Filipino cuisine. You get one free meal a day, a single go at the food stations, and complete freedom to get your fill as greedily as you want. We saw employees glowing at lunch (like they were blessed), some of them with plates filled like we used to do it at a Wendy’s salad bar. They also had bottomless drinks and free ice cream. As we ate, we thought of our own pantry at work and the guy named Brownie who went around selling us lunches packed in styro. We didn’t want to cry.
Note that this is just a perk. You will want to know about salaries.
We asked around the social network for friends who knew people who worked at Solaire and found one, a dealer who had no prior experience. She graduated with a nursing degree but went on selling condos until finally applying to be a dealer at Solaire.
She was hired with a training allowance of PI5,000. She refused to say how much exactly she makes now that Solaire is in operation but pegs it at about double the training allowance.
Door girls, on the other hand, the tall beautiful ladies you see greeting guests and helping out in any way they can, reportedly make P60,000.
The average salary of an OFW working in Macau is anywhere from P60,000 to P90,000.
But the prospects for an OFW working in the Macau gaming industry to come home is now even more appealing given that Macau is faced with a dilemma: According to a Bloomberg report in 2012, Macau needs more workers as gambling revenue goes up, but there are rules requiring firms to hire only locals. And there is practically zero unemployment rate in Macau.
Ronald, an OFW working in a Macau casino, is looking forward to it.
“This is, for me, a very good opportunity for my fellow Filipinos here in Macau to think of going back home and continuing our careers there—-be it in gaming or F&B… because of this boom in the gaming industry in Manila, we are given the chance to be with our family again and earn as well. Maybe not as much as what we get here but I’m positive it will boost in due time…this is the main reason I’m contemplating coming back home and continue my profession here.”