$300M Tinian casino lease deal up for signing

The Macau investor planning to invest $300 million in a casino resort on Tinian is set to sign a 152-hectare land lease agreement with the Department of Public Lands on Thursday afternoon, but the Legislature still has the final word on whether to approve or reject the deal between DPL and Alter City Group Inc.

Some two hours after the 3pm signing of the land lease deal with DPL on Thursday, Alter City Group president and chair Leong Kin Lan will lead a project briefing and presentation for lawmakers at Fiesta Resort & Spa Saipan.

Senate President Ralph Torres (R-Saipan) said yesterday that a joint session of the Senate and House of Representatives could be held as early as next week to act on the “signed” lease agreement between DPL and Alter City Group.

Any proposed lease of more than 5 hectares of public lands requires the Legislature’s approval.

Thursday’s land lease deal signing between DPL and Alter City Group will come a day after two Senate and House committees hold a rescheduled joint public hearing on the land lease deal on Tinian at 5pm today.

The public hearing at the Tinian Court House was initially announced for yesterday.

“After the public hearing on Tinian, the committee will still have to come up with a report recommending to the House and Senate whether to approve or reject the lease agreement. There is no way that a committee report on a Wednesday night public hearing, plus the recommendation, will be out before the Thursday signing between DPL and the investor,” Rep. Anthony Benavente (Ind-Saipan) said yesterday.

Benavente is chairman of the House Natural Resources Committee, which joins the Senate Committee on Resources, Economic Development and Programs in holding today’s public hearing at the Tinian Court House.

“The final approval whether those public lands on Tinian will be leased to the investor will come from the Legislature,” Benavente said.

He said yesterday’s original public hearing was rescheduled for today because of some miscommunication.

Acting press secretary Ivan Blanco said Gov. Eloy S. Inos will be at the signing ceremony on Thursday at 3pm in the governor’s conference room on Capital Hill.

On the same time and date, the Senate will be having its thrice rescheduled session.

Edvon Sze, chief executive officer of Alter City Group, said in an invitation to lawmakers yesterday that Thursday’s 5:30pm briefing will provide details on the proposed project and lease with DPL “to further develop the island of Tinian with world-class hotel facilities, golf course, villas, and a water park.”

Alter City Group Inc., wholly owned by Macau-based Alter City Group Holdings Ltd., plans to build 1,000 hotel rooms, water parks, an 18-hole golf course, villas, casino facilities, and related tourism amenities.

Alter City Group still has to apply for a casino license.

Originally, Alter City Group planned to invest some $200 million. It revised its planned investment to $300 million over time.

That is still dwarfed by Best Sunshine International Ltd.’s $3.14-billion integrated casino resort on Saipan under an exclusive casino license.

However, unlike Saipan that has an exclusive casino developer, Tinian can issue multiple casino licenses. At present, only Tinian Dynasty Hotel & Casino is the operating casino on Tinian and the whole CNMI.

DPL Secretary Pete A. Tenorio submitted to the Legislature a “draft” lease agreement between DPL and Alter City Group for up to 40 years for lawmakers’ advance information and review.

Tenorio said DPL will transmit a “signed” lease agreement to the Legislature for its final disposition.

The maximum 40-year lease includes the initial 25-year lease with the option to extend for 15 more years. The project site is Puntan Diablo, also known as Nasarino, the same area previously leased by the Marianas Resort Development Corp. before the latter abandoned the lease. MRDC had also planned to build a $300-million casino resort on the property.

DPL expects the Tinian casino project to have a gross revenue of over $1.436 billion in 25 years. It said once the proposed lease is approved, Alter City Group will pay a security deposit of $300,000.

There will also be an advance payment of $340,000 for the first five years of the lease during planning and construction of phase 1.