$640K in security deposit, advance lease payments made
Macau-based Alter City Group Holdings Ltd. and the CNMI Department of Public Lands signed yesterday afternoon a 152-hectare Tinian land lease agreement for a $300-million casino resort that they expect to complete within 12 years. The signed lease for the three-phased project will still be subject to the Legislature’s approval or rejection as early as next week.
At the lease signing that Gov. Eloy S. Inos and Lt. Gov. Jude U. Hofschneider witnessed, Alter City Group president and board chair Leong Kin Ian also handed a $640,000 check to DPL Secretary Pete A. Tenorio.
That represents $300,000 in security deposit and $340,000 in advance land lease payment.
Leong told CNMI officials that Alter City Group has full confidence in their ability to build the casino resort, which includes 1,500 hotel rooms, water park, 18-hole golf course, casino facilities, and related tourism amenities.
Alter City Group still has to apply for a casino license.
Alter City Group executive vice president Ken Lin and Edvon Sze, along with Leong, also vowed to work closely with the CNMI government on the project, particularly in complying with the requirements.
“What is good for Tinian should be good for the CNMI,” the governor said at the ceremony, attended by his Cabinet members, Tinian Mayor Ramon Dela Cruz, and about a dozen executives of Alter City Group.
DPL’s Tenorio said the proposed project will be the “first megaresort on Tinian” given the size of the investment.
The signed land lease is for 25 years, with an option to extend for 15 more years for a total of 40 years.
The casino resort will be built on Tinian’s Puntan Diablo, also known as Nasarino, the same area formerly leased by another investor that also planned to build a $300-million casino resort.
The lease signing followed a Wednesday night joint public hearing on Tinian by the House Committee on Natural Resources and the Senate Committee on Resources, Economic Development and Programs.
DPL’s Tenorio said upon completion of all three phases and beginning on the 11th year, Alter City will pay a guaranteed annual amount of not less than 2.5 percent of the appraised value of land or 1 percent of business gross revenues from all sources, including casino revenues, whichever is greater.
The department also estimates the business gross revenue payment to average $574,456 a year in the 11th through the 20th year, and $718,070 in the 21st through the 25th year.
If the 15-year extension option is approved, the average annual rental payment will be $718,070 from 2040 to 2044; $861,684 from 2045 to 2049; and over $1.005 million from 2050 to 2055.
Tenorio said direct public contribution includes $5 million toward improving Tinian’s airport and ferry services, among other things.
At the ceremony, the DPL secretary also spoke of new jobs, local employment, job skills training, payment of excise tax, gross business taxes, wages and other taxes.
Some two hours after the land lease signing, Alter City Group made a project briefing and presentation for dignitaries at Fiesta Resort & Spa Saipan.