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Current as of 28/04/17 07:40PM NZST
Property editor of the NZ Herald

SkyCity eyes Manila casino

Group cools on Gold Coast plans but keeping tabs on gambling ventures in Philippines.

Nigel Morrison. Photo / Greg Bowker
Nigel Morrison. Photo / Greg Bowker

SkyCity Entertainment Group is eyeing a Manila casino opportunity but has stepped away from Gold Coast plans.

"We're staying close to the Philippines and monitoring that space," said chief executive Nigel Morrison after SkyCity's annual result last week.

Auckland still generates the biggest earnings for SkyCity but it is casting its net wider, hoping to develop a new casino overseas.

Manila Bay has been earmarked for a casino as the Philippines taps into the multibillion-dollar Chinese gambling market and this year Morrison announced SkyCity's interest in moving in there, taking the investment community by surprise.

"We are always looking at ways to grow the business beyond our existing markets and proactively review new opportunities to create shareholder value," he said in February. "The Philippines is recognised as one of the most exciting new emerging gaming markets in Asia."

He said senior SkyCity executives had visited the Philippines many times and "believe in the potential for future growth".

But it is not known just how SkyCity plans to move there, and particularly whether it will be in a consortium arrangement.

In March, Bloomberg reported on the opening of billionaire Enrique Razon's US$1.2 billion ($1.48 billion) Solaire Manila casino in Manila. It has a monopoly in the city "until the country's richest man, Henry Sy, opens a venture there in 2014".

The billionaires are investing in casinos as the Southeast Asian nation seeks to emulate the success of Macau, where gamblers from China's mainland fuelled a 14 per cent revenue surge to a record $38 billion last year. New resorts could help the Philippines' gaming market expand fivefold to $10 billion by 2017, its chief regulator estimates, according to Bloomberg.

"Razon's venture is closely watched because it can prove if the Philippines can get a bigger share of junket and VIP market in Asia," said Allan Yu, who helps to manage about $11 billion at Metropolitan Bank & Trust. "It's very promising and it looks like it's going to take off."

A venture of Japanese billionaire Kazuo Okada and a fourth casino in the Manila complex by Philippine billionaire Andrew Tan and Genting Hong Kong are tipped to open between 2015 and 2016.

Morrison told last Wednesday's Auckland briefing how Gold Coast plans had been ditched.

In Australia, SkyCity was in the Azure Consortium with Brookfield Multiplex, vying for the right to develop a casino along with wider entertainment and tourism facilities including a cruise ship terminal in Queensland, he said.

But authorities were unable to confirm whether a casino would be part of the wider cruise ship terminal.

"So we have withdrawn on that basis, if we can't get certainty that there will be a casino in that space."

The Gold Coast already has Jupiters Hotel and Casino at Broadbeach.

High stakes

SkyCity Auckland, money generated in year to June 30, 2013:

* $391.1m revenue from all gaming at the property
* $212.9m from machines
* $123.2m from tables, locals
* $55m from tables, international visitors
* $46.6m food and beverage revenue
* $57m hotels and convention revenue
* $21.5m from Sky Tower, parking and other activities

- NZ Herald

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