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Increased Competition In The Philippines As Another Challenge For Casino Operators
The Covid-19 pandemic is not a single challenge the Philippines gambling industry faced in 2020. It has been recently reported that the local casino industry might extend, meaning the competition between casino operators is getting tougher. Experts consider new operators’ appearance as another difficulty combined with post-Covid-19 problems.
It’s not a secret that the Philippines is flooded with multiple casino operators, but we will soon see some more gambling locations. Westside City’s construction is almost done, and Waterfront Philippines has solved a problem in a court, so it is ready to fulfill its plans. Waterfront had won a Supreme Court battle forcing PAGCOR to grant a proposed development license. Moreover, the New World Manila Bay Hotel and Casino is serious about showing its intention of upgrading the property into an Integrated Resort (IR).
Resort World Westside City is going to be a 1,959,031 sq ft casino and a five-star hotel with 1,500 rooms. The offered selection of games will comprise 400 gaming tables and 1,200 slots. Moreover, an area of 473,612 sq ft is set aside for diverse restaurants and retail stores. Currently, Westside City is controlled by Suncity Holdings Group, and an extra $268.6 million has been allocated for finance development.
We also do not know the timing of these new resorts and their respective sizes. Nevertheless, I believe in the short term this will increase competition in the area and will lead to some market share being taken from existing IRs. This will also lead to some margin erosion. But history shows that new IRs are able to grow the pie over the long term.
The number of existing casino properties and Integrated Resorts is not overwhelming just because there was imposed a moratorium on issuing new casino licenses. This moratorium was established in 2017 and is valid for five years, meaning it expires in a year. There is no information about pursuing the moratorium’s actions. In contrast, President Rodrigo Duterte hinted that he is ready to see more casinos in the Philippines.
Once the Covid-19 virus appeared, it has made changes in our life. For this reason, a new approach was offered by experts for controlling the gambling market. CEO of Gaming Concepts Group said: “We are strongly urging developers to reconsider their number of Junket rooms and to lower their expectations with the related revenues, and to consider a much more rounded gaming floor offering with the focus on mass and premium mass, as Macau is now doing, large sportsbooks, vibrant stage shows, and a multitude of gaming floor F&B outlets.” It has been suggested to open larger gaming floors where the locals can get more entertainment and be served food and drinks. The experts also expect the number of business travelers, conferences, and international tourists, in general, never to be the same.
“A major concern that all potential developers need to recognize quite clearly is that there are no restrictions on licenses being issued, as we have seen in Clark, for example, with upwards of 12-13 licenses, so this must always be taken into account. The balance between increasing revenues and how many operators will be sharing it makes things very competitive,” pointed Feeney. Before the Covid-19 pandemic appeared, the Philippines had shown pretty high results on the region’s market as far as it had been a popular spot among the tourists.
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