Bidding for Pagcor land fails; negotiated sale eyed
State-owned Philippine Amusement & Gaming Corp.’s (Pagcor) latest attempt to bid out the 16-hectare property where Solaire Resort & Casino stands—valued for at least P37.23 billion—failed on Friday, giving the gaming regulator leeway to privatize the land through negotiated sale.
During a bidding last Friday, industry sources said only Bloomberry Resort Corp. subsidiary Sureste Properties Inc. (SPI), owner and operator of the hotel and nongaming facilities in Solaire and the lessee of the land, submitted an offer.
Under Pagcor’s bidding rules, at least two bidders must submit a bid tender for the property to be auctioned. In the event of a failed public bidding, Pagcor can enter into a negotiated sale.
In a disclosure to the Philippine Stock Exchange on Friday, Bloomberry said SPI had also “submitted to Pagcor an offer to purchase the subject land by negotiated sale, in the event the bidding will fail.”
This was the second failed attempt to bid out the property. The first was on Dec. 1, 2017.
For its part, Pagcor seeks to unlock values from the prime property, which forms part of what is envisioned to be Metro Manila’s version of the Las Vegas entertainment strip.
The floor price for the 16-hectare land was set at P37.23 billion, exclusive of value-added tax. This translates to a minimum of about P233,000 per square meter, still lower than the P500,000-per square-meter valuation in BGC central business district.
Bloomberry is seen as the most, if not the only, interested party because owning the lot now occupied by Solaire will secure its $1.2-billion investment in this gaming resort for the long term.
Solaire was the first property to open in Pagcor’s Entertainment City with the opening of Sky Tower in November 2014. Aside from a 312-key all-suite five-star hotel, Sky Tower features other amenities such as The Theatre, a 1,760-seat Broadway-style theatre; The Macallan, a luxury cigar and whisky bar; 1,000 square meters of meeting space in The Forum; an international KTV bar, and additional gaming facilities. Solaire’s high-end retail area, The Shoppes at Solaire, recently rolled out the following luxury boutiques: Louis Vuitton, Prada, Bvlgari, Salvatore Ferragamo and Givenchy.
The lease period assigned to SPI is up to July 11, 2033 and is extendible for another term under certain conditions, based on the Pagcor documents.
Bloomberry’s bid to acquire the lot where Solaire is located comes at a time when it has been reporting stronger than expected profits. Overall, the gaming sector is also seen to benefit from the growth of the local and overseas gaming sectors.
Of the four Pagcor licensees in Entertainment City, Bloomberry is so far the only one that does not own the land where it operates.
Had another party won the bid for the land, it will still be bound to honor the lease contract with SPI. Based on the Pagcor bidding terms, ownership of the property does not confer the right to operate gaming facilities.
Bloomberry, led by tycoon Enrique Razon Jr. who also controls International Container Terminal Services Inc., is currently valued by the stock market at P141 billion.
