Asian Coast Development (Canada) has received approval from the government of Vietnam to amendments it requested to its investment certificate in a move that could contribute to getting the company’s delayed Ho Tram Strip resort open.
ACDL Chief Executive Officer Lloyd Nathan called it a “landmark day” for the project.
Located on the South China Sea coast about 70 miles from Ho Chi Minh City, Ho Tram has faced funding difficulties and regulatory and other problems, though its first phase is reported to be complete, with 541 rooms and suites, a casino for foreign passport holders, restaurants, shopping, a spa, swimming pools and beachfront and other leisure attractions.
Banks had suspended a US$175 million credit facility contingent upon receiving an amendment to the investment certificate, and analysts believe the project may still need additional working capital and possibly more development funding. Last month, MGM Resorts International, which was to manage the property, pulled out without citing any reasons.
“A key concern is the lack of a gaming operator at present,” Las Vegas-based Union Gaming wrote this week in a note to investors. “We don’t believe that the granting of the investment certificate will catalyze MGM to reconsider.”
Investors include U.S.-listed casino operator Pinnacle Entertainment, which could possibly step in to run the resort, although Union Gaming cited “other challenges,” including “a prohibition on locals gambling, withholding tax on winnings in Vietnam, and the lack of a final Gaming Decree resulting in a default to more stringent regulatory standards.”
In the meantime, ACDL says it is already constructing a second hotel tower of 559 rooms and an 18-hole golf course.
