SM Investments Corp. has secured a provisional license from the government casino franchise firm Philippine Amusement and Gaming Corp. (Pagcor) to pave the way for development of a world-class entertainment and gaming hub on a 60-hectare property of its second-biggest mall, a company official said.

SMIC got the license Friday from Pagcor and will proceed in 2009 with the first phase of the development, which will cost an estimated P10 billion and include entertainment and gaming facilities and hotels in the Mall of Asia property in the Manila Bay reclamation area, SM executive vice president and chief financial officer Jose T. Sio said.

SM Land Inc., the SM group’s property unit, will develop the entertainment complex, in line with the group’s thrust to venture into tourism development, Sio said.

SMIC vice chairman Henry Sy Jr. said: “We believe in the country’s strong potential in tourism. As such, SM will be at the forefront in providing much-needed infrastructure and facilities for more tourists to enjoy the country’s scenic destinations while experiencing the warmth of Philippine hospitality.”

Sio said the entertainment hub would include a gaming facility on a 10,000-square-meter lot near the Mall of Asia’s Esplanade building. It may consist of two floors and will be operated by an international casino operator, he said.

“There is strong demand for gaming,” Sio said. “When tourists come here, they look for places to be entertained.”

The entertainment hub will include hotels that will be operated by the international chain Radisson and the luxury brand Regent, and a theater for the performing arts, he said.

There will also be a residential component, and a ferry terminal that will directly link the Mall of Asia complex with the SM group’s Hamilo Coast resort project in Batangas province, south of Manila, he added.

SMIC vice president Cora Guidote said the entertainment complex could start construction in the first half of next year.

Despite the prevailing global economic downturn, the SM group has continued to expand its retail businesses.

Its mall operations unit, SM Prime Holdings Corp., said Friday it had opened “The Annex” at its SM North EDSA mall in Quezon City, with 90,000 square meters of gross floor area.

With the additional floor area, SM City North EDSA has become the third-biggest shopping mall in the world. Mall of Asia, SM Megamall in Mandaluyong City, and SM City Cebu in Cebu City rank fourth, seventh, and 11th biggest in the world, respectively. All these malls have occupancy rates of over 95 percent, according to information from the SM group. Edited by INQUIRER.net