By George Telaveris
Larnaca and Limassol are set to battle for Cyprus’ first casino licence, with ‘tiger’ NagaCorp of Cambodia vying for a Larnaca resort and ‘dragon’ Melco International Development of Macau planning to build one in Limassol.
Bloomberry Resorts Corp, owned by Filipino billionaire Enrique K. Razon Jr., had earlier dropped out of the race.
“NagaCorp is currently holding talks with two owners of land in Larnaca and it’s a matter of days before they agree,” a person involved in the negotiations told the Cyprus Weekly.
The Melco International Development-Hard Rock International-Cyprus Phasouri consortium has already secured the necessary land in Limassol. Land has been an issue for the casino bidders and, until a week ago, it was thought that Melco consortium was the only one that would make the final offer.
However, NagaCorp is now placing its bets on Larnaca, as it can see potential beyond the opportunities that the casino will provide.
“The prospect of creating a marina in the city port is something that adds value to Larnaca and its real estate. Casino investors are surely taking good note of all this,” the Cyprus Weekly was told. NagaCorp owns, manages and operates NagaWorld, the 700-room integrated gaming and entertainment hotel complex in the capital city of Cambodia. NagaWorld is the only licensed casino in the country.
The founder and controlling shareholder of NagaCorp is the 68-year-old Tan Sri Dr Chen Lip Keong from Malaysia.
Limassol can offer the fact that it is booming, despite the setback from the 2013 financial crisis. It has major projects under construction like the ‘Oval’ and the ‘Twin Towers’.
Equally, it already has a newly-built marina, which makes Melco’s Chairman and CEO, Lawrence Ho, confident about his decision to invest.
“The Cyprus premium integrated resort project, along with the Group’s latest business development in Spain, showcase Melco’s focus on further strengthening the Group’s presence in overseas markets to build a sustainable growth company,” he told shareholders in May.
Melco is one of the big Macau players. The company owns and operates properties under the City of Dreams, Studio City, Altira, and Tigre de Cristal names, while generating $4.8 billion in revenues. At the same time, Hard Rock International, with venues in 68 countries, including 162 cafes, 23 hotels and 11 casinos, is one of the most globally-recognised companies. According to a report by Deloitte in 2013, the development of a casino resort in Cyprus could add €47 million to state earnings, create 4,000 new jobs and boost annual tourism revenue by €187m.
The government estimates that a casino resort could add over 500,000 visitors annually, mainly from the Arab countries, Israel, the Balkans and Russia. It also estimates that casino investment could reach €500 million.
The minimum requirements for the casino licence are 100 tables and 1,000 machines. Under the government’s policy outline, the successful bidder could start operating a casino immediately for a period of 30 years.
According to legislation, the investor will have the option to build one regional establishment, with up to five table games and 50 slot machines, in addition to the main casino.