Japanese casino and pachinko operator Universal Entertainment has apparently resolved the land ownership problems that threatened to derail its Manila Bay Resorts casino development in the Philippines. On Friday, Universal’s Philippine subsidiary Eagle I Landholdings Inc. announced it had signed a memorandum of understanding with local real estate outfit Century Properties Group (CPG) to develop five hectares of the 44-hectare Manila Bay Resorts property, which is one of four integrated resort casinos being built in the Entertainment City project in the Philippine capital. The deal also calls for CPG to take a 36% stake in Eagle I.
Philippine law requires international firms to partner with local companies – a stipulation Universal chairman Kazuo Okada thought he’d observed when he hooked up with Robinsons Land, the Lance Gokongwei-led property firm. But negotiations on that deal broke down in May, reportedly over Robinsons’ desire to also acquire a stake in Tiger Resorts, Leisure and Entertainment, the Universal subsidiary tasked with overseeing Manila Bay Resorts’ gambling operations. The breakdown in talks led Philippine gaming regulator PAGCOR to warn Universal that the casino wouldn’t be allowed to open its doors until the situation was resolved.
CPG, which is controlled by the family of businessman Jose Antonio, has developed upscale properties in tandem with international brands including Trump and Versace. Assuming the deal is approved by regulators, CPG plans to develop 300k-square-meters of luxury residential and retail floor area on the five-hectare site. The announcement of the deal specifically stated that CPG would not involve itself “in any aspect of the gaming operations.”
While Okada will be happy to have resolved his local partner problem, there’s still the little matter of those alleged violations of the Anti-Dummy Law and the Foreign Investments Act of 1991 that the Philippine Department of Justice continues to investigate. Suffice it to say, Universal is likely keeping the corks firmly lodged in the champagne bottles a little while longer.
