Butch Francisco, president of Philippine Amusement and Gaming Corp. (PAGCOR), talked about the ambitious entertainment complex, Entertainment City, with Ricky Carandang in [email protected] Friday, April 4.
Francisco said Entertainment City is not just gambling, it’s all about entertainment and tourism.
These are pretty impressive numbers. how many billion dollars are we talking about here?
Easily if investors would invest an average of $2 billion to $3 billion, and there are right now four investors assured of investing $24 billion each. So easily we can raise about $12 billion to $15 billion in investments.
These people, when you say they are putting in three to four, that's committed. They've pledged to put that in into this project?
Yes. In accordance with our terms of reference, which we published last year, the minimum participating amount for a participant in the project will be $1 billion.
Okay. So we're looking, at the very least, at $4 billion and perhaps as much $15 billion?
Even if you take the lower figures, that's a pretty good investment, and we're not talking about equity, right?
Tell me what the complex is and why it's going to need all this money.
Well, easily, when you are... We're looking at the model, which Singapore, for one has successfully started having an integrated resort. In fact, they awarded two areas in Singapore. In each resort, using that model, which requires a complex that will have an integrated facility of recreational and entertainment activities. The computation or calculation require an investment of a minimum of $1 billion.
So we're talking about entertainment gaming complex. There's gonna be hotels. Will there be…
Retail as well.
Will there be commercial, will there be residential?
That's correct. That's why it's called an integrated resort. Resort, because its a center for recreation and entertainment. Integrated because of all the units that will form part of the resort. Let me correct this, that the gaming side is, I would say, less than 5 percent of the total activities that will happen in that complex. Basically, it's still retail, dining and entertainment.
But certainly gaming is going to be a big contributor to revenues. We all know that. No matter what anyone says about it. It is a big money earner.
How does it work? You've got five investors who you're looking at. Four, you said at least four. Is it based on a master plan, and then they'll decide which parts of it that they're gonna take on?
That's correct. In terms of reference, we offered a 40-hectare land, which is now under PAGCOR. And in this 40-hectare along Manila Bay, we asked for concepts from, to the public, companies who would like to participate in the project. Based on the terms of reference they have submitted, the concepts and of course also the investments required, they have seriously considered. We have seen the seriousness and the passing the grade of having a truly integrated resort.
The integrated resort, we have used the acronym or used the guide of the acronym P.A.I.N.T. PAINT will stand for partners, architecture, investments, novelty and tourism. And if we talk about partners, the investors should have a track record, and we would like also to see who their partners are to be able to see the seriousness of their capability. The architecture side would refer to the design of the concept and also the reputation of the designers in building such a concept. The I in that P.A.I.N.T. will be the investment. In our terms of reference, we mentioned a minimum of $1 billion. Initially in the terms of reference, we asked serious investors first to apply, pay a $50,000 application fee and submit a concept along with a $100 million commitment. Then you can you see how the seriousness of the investor.
But there is a master plan, right?
There is a master plan. But this master plan is a guide post. We still need to see how the investors will like to help us in developing the master plan. For as long as the integrated resort model is there, and of course in the P.A.I.N.T. word, there's N, novelty. The novelty of their concept, like for example, their being a world class theme park. You could talk about, Singapore bringing in Universal Studios. So, what is the investor bringing in the complex.
Yeah, tell me what's its gonna have because we know that it'll have some gaming tables. We also know that it's gonna have a theme park. Star Cruise is here so I presume there's gonna be a cruise element.
And it's the first time they'll be visiting, as often as they can. There're luxury ships.
And this are bringing in tourist from where?
From all over the region. Star Cruise is the third largest cruise liner in the world.
This is big! I mean this is a very ambitious plan, isn't it?
It's a good model, which our country will be happy about because of the attractiveness that it can generate in promoting tourism.
That's right, investments and jobs. I was reading in the introduction you we're expecting to create about 200 jobs?
Yes initially, because of the construction. Easily one complex will employ over 20,000 employees. In The Venetian in Macao has employed over 15,000 employees.
A lot of them Filipino if I'm not mistaken…
I would say so, about one-third. With this complex, I won't be surprised that many of these Filipinos will perhaps be coming back. In the terms of reference, we are asking the investors that once they operate the salaries should be competitive, within the region.
That actually has some potential of bringing back people who have left the country?
So, there's certainly economic benefits. I can also see, you know, the investment and all that. You haven't gotten a lot of opposition to this?
Well this has been in the drawing board since 2001.
So it's not a surprise?
Yeah. It's not a surprise. We went into the process of discussing this with different groups. We explained to them that because PAGCOR will always be related to gambling. We explained ourselves that PAGCOR has shifted from gambling to dining and entertainment. I'm very happy that society, as a whole, is understanding this model that we are trying to set up.
How long will it take before we actually see these things up and running?
Immediately, we can see it in the next few months. We will start the development of the site. We can have the initial phase, the first facility will open sometime in 2010. Two years from now.
2010 and then beyond?
Beyond that. It's a five, seven year project.
In the south you have Singapore proceeding. I think they are a little bit ahead of us as far as construction and planning are concerned.
Yes, but we might just be able to ah.. Just about the same time to open. The first facility to open will open in the late 2009, and we expect the first facility in Nayong Pilipino in the first quarter of 2010. Just slightly behind.
In the north you've got Macau, it's already there. I know that it's not exactly the same, but it's along the same broad strokes. What do you think is going to be the draw for us? Macau and Singapore trying to compete from roughly the same market. What's the unique selling point for this project here in the Philippines?
Number one, it's the people, the hospitality. I've seen how they operate in Macau, the same in Singapore. Generally, I've spoken to a lot of people, and because of our hospitality and our language, it's universal, being able to speak English.
The Singaporeans can do that...
The Singaporeans can do it, but how many can they employ from their own side. They have to employ Filipinos as well.
So we have scale that would set us apart from Singapore?
And english will set us apart from Macau?
Yes. That's right.
So, there's no more hitches. This is all systems go?
All systems go. Also another thing is the structure that we have, the legal framework that we have in conducting business in the Philippines, they're happy. All the laws are in place for such a complex that we will put up. We have the laws on gambling in place. We have laws in doing business in place. In Macau, people say that many things had to be done. Singapore is the most transparent.