Kevin Tan, Alliance Global Group (AGI) CEO and son of the company founder Andrew Tan, is building on the family legacy, with a particular focus on property development arm Megaworld and tourism entity Travellers, the operator of Manila’s Newport World Resorts. Tan spoke with IAG about his long-term vision for Newport, from recent sweeping changes to the executive team to expansion plans and new opportunities.
Andrew W Scott: Mr Kevin Tan, thank you for speaking to the readers of Inside Asian Gaming. You’ve been at the helm of Travellers for a little while now, a relatively short time but enough to make some important decisions about the company. Some of our readers may not be very familiar with you, perhaps you could tell us a little bit about your background?
Kevin L Tan: Sure, I am a developer by profession.
I belong to Alliance Global Group, the company that my father founded 45 years ago. We are of course in the liquor business – as you know we are owners of Emperador Brandy which is the largest selling brandy in the world. Also, we are owners of Whyte & Mackay and Dalmore which is the fifth largest scotch whisky and single malt company in the world.
And then of course we are in property development through Megaworld. Megaworld is really where I started my career and where I have been working for over 20 years now. We’re also in the food business, and in hospitality.
So really my background is more on the property development side. We build townships, we run malls, we run hotels, we build entire cities. We actually have about 32 townships now all across the Philippines and we’re going to 35 by the end of the year.
That’s my background coming into this business. I have no formal training or any experience here in the gaming business but I believe that running an integrated resort is pretty much a property play as well in itself.
And my orientation with retail, mall developments and to a certain extent the food business, F&B sector – there’s a lot of expertise like improving service, customer service, understanding what your customers want and things like that you can apply to the integrated resort business. And I think that’s how I got to where I am right now.
AWS: You recently made some sweeping changes to the leadership here at Newport World Resorts. The CEO, COO and CFO all departed on the same day. Why did you feel the need to go down that path?
KLT: First off, the three were part of the opening team. So credit to them, they did start this property. They did provide the foundation of where we are today. But I guess 15 years later, the startup team and those who would be in charge of growing the business need not necessarily be the same team. And when I came in last year when we had basically acquired the shares of our partners (Genting Hong Kong), what I saw we needed was really a team that is more energetic, a team that is more driven. That’s why I started to assemble a team made up of executives from different gaming jurisdictions, very competitive gaming jurisdictions to come here to Manila to help manage Newport World Resorts and to help bring us to the next level.
We basically had an agreement to do this transition. Of course, the truth is – just to put some of the speculation to rest – there were definitely some disagreements on the management style or the mindsets. Definitely there was a disagreement on values, a misalignment also maybe on certain things like integrity and basic ethical behavior. So, there were definitely disagreements and misalignments there. That’s why I think it was the right time to make this transition to the new team.
AWS: You’ve now got a new team with Nilo Rodriguez as CEO, Lance Gautreaux as COO and Lawrence Hawke as CFO.Tell us a bit about this new trio and what they bring to the company.
KLT: Well, Nilo, I invited him as far back as 2022 and I had originally already intended for him to take over the company even as far back as then, but obviously he comes from a very different industry. We needed him to learn the ropes first here at the resort, but he learned very quickly. The reason this became very natural to me is because he’s been in hospitality for several decades now. He was with Hilton in Japan and then with Northwest and Delta. When I invited him, he was actually stationed back in Manila with Philippine Airlines in charge of the massive debt restructuring during COVID. The airline industry was massively hit during the pandemic and he was in charge of doing this debt restructuring, which brought the airline back to profitability right after the pandemic. So, I thought that he definitely possessed the right skills to be able to run the integrated resort professionally. He is a CPA by profession, an accountant, so he would definitely know how to manage the finances of the company. Of course, Lawrence and Lance, they come from very, very diverse gaming backgrounds. Lance has spent almost three decades in the gaming industry, 12 years with Las Vegas Sands – arguably one of the best gaming companies in the world. He was stationed in Singapore, in Macau, and then later on in Las Vegas. And these three jurisdictions are arguably the most competitive. Las Vegas Sands is a market leader in these jurisdictions. So, I thought his wealth of experience would definitely bring a lot of value to this company and will really bring a lot of innovation and a lot of expertise to take us to the next level. And Lawrence, of course, he’s our newest hire. I invited him right after the transition had been completed. And it was important. He also comes from a very diverse gaming background. He had already been in Manila with another integrated resort and I think that he definitely has the expertise and the skills and the professionalism that this company needs. So, I think with these three right now at the helm of our company, we’re in a very good place.
AWS: I remember coming here to Resorts World Manila as it was back then in the very month that it opened in August 2009 – a long time ago now – and I remember thinking it was a place of promise and excitement. It was the first integrated resort to open in the Philippines. Now, 15 years later, do you think the property has lived up to the potential it had 15 years ago?
KLT: Well, a lot has happened in the last 15 years. I think when you visited us, when we first opened, we only had maybe one or two hotels. It was the Marriott and then Maxims. Today, the property has five hotels and we’re on the way to opening our latest offering, the Newport Mansion, which was the former Maxims. I think there is still so much potential for the property. We effectively have more than 3,000 room keys in our property. We have two casinos in our property that are connected by two bridges. We have more than 71 food outlets, would you believe, all over this property. We have retail, we have a convention center, lots and lots of different amenities, different pools and a lot of the other resort amenities that I think are not found in any other integrated resort.
But I think we still have a long way to go.
What we’re doing right now is improving our facilities, renovating our older products and elevating the guest experience by elevating our service. That’s our goal as a group, to really elevate that part of the business.
AWS: As CEO of Alliance Global Group, you are no doubt a very busy man given the many business arms you oversee. How much time do you dedicate to Newport?
KLT: All our businesses are quite interesting. They’re very different from each other, but in a way there’s also some sort of relationship because they’re all lifestyle businesses. They’re all consumer businesses and they’re all trading in the premium side of the category. Even if you talk about McDonald’s, for example,
if you look at our competitors or the different brands in that category, McDonald’s would always be the most premium. It’s the same with Emperador and Megaworld. All our companies are run very professionally. We have an excellent executive management group managing each and every one of our various companies.
The McDonald’s business is actually being run by our partners, so I sit on the board and that doesn’t take up too much of my time. Emporador as well, we have a very experienced executive committee there as well, and that’s my father’s personal passion, so he spends his semi-retirement days dabbling more on that business because I don’t think I can be in that business. I think I’ll be an alcoholic by now if I were! So, I’m really more focused on the property side and here in the integrated resort. I like to joke that my day job is in the property business, so I spend almost all my mornings on Megaworld, and then I shift to my afternoon and night job which is here at the integrated resort. It’s exciting. It’s just an exciting time to be here in Newport World Resorts.
AWS: How would you describe your leadership style?
KLT: I think I’m a very inclusive leader. I definitely believe in collaboration. I try to bring all the teams together and I try to get everyone talking. I also don’t like to micromanage. I tend to give all my executives a free hand. I try not to meddle at all. I mean, I’ll give suggestions but I won’t necessarily impose or push directions down their throat. The feedback I get is that’s the right way to manage, especially professionals that you’ve hired to do a certain job that they’re supposed to be the best at, right? So that’s the kind of leader I am and that’s the kind of leadership trait I have – more of an open leadership style, less micromanaging.
AWS: Newport World Resorts is interesting in that it’s directly across the road from Ninoy Aquino International Airport – so close you can walk between the two – and therefore you are a little away from the other Entertainment City properties. How do you think your location helps or hinders you, and how do you respond to that?
KLT: Well, first off on the bridge [between the airport and Newport], the plan is that in two years’ time that bridge will be fully connected to the resort. You literally will not have to leave the building to go to the airport. You will be able to take a series of walkways that are air conditioned with walkalators to go to the airport. That’s the plan we have.
I don’t necessarily see being away from Entertainment City as a negative. In fact, it could be an opportunity because the competition in that area is just totally cutthroat. And when you see the way they operate around each other, it’s amazing but I imagine also very challenging.
I think that being on our own here and having the scale, having so many amenities, brings tremendous opportunity for growth for us here. Being close to the airport is a bonus, of course. And we have the most hotel rooms of any integrated resort [in the Philippines]. Again, that is a tremendous opportunity for this property and that’s why we are now leveraging on these opportunities to bring us to the next level.
AWS: AGI has stated in the past that it is interested in opening a second property, much like one of your industry peers in Bloomberry Resorts has opened a second property now in Solaire Resort North. Could you tell us a little bit about your plans for future expansion and what other properties you might open in the Philippines?
KLT: One of the biggest advantages for our company is that because we are sister companies with Megaworld, we pretty much already have the land bank. Megaworld, as I mentioned, is present in over 32 locations all over the country and a lot of those locations are tourism areas such as Boracay, Cebu, Palawan, Batangas, and even all the way up north, we have a property as well.
So, we are well situated in high traffic tourist areas or tourist destinations in the Philippines and that gives us tremendous opportunity to expand wherever we feel the market would need us.
We’re very excited about Boracay. In fact, that’s the next resort that we will probably be opening. We are already in the planning stages of that. It’s not going to be a massive property but I think it’s just right for the market there. It is situated in our flagship township, which is called Boracay Newcoast, which spans about 140 hectares. It is the only resort on the Boracay island that has a golf course and it already comprises 10% of the entire Boracay Island. We have our own private beach there, we have over 1,500 room keys there and we continue to build there. So that’s probably our next location.
I think the opportunity for growth in this sector will be to open outside Metro Manila. I think Metro Manila is quite saturated already and it’s quite competitive. Even Clark is very competitive. But to go beyond that, to build facilities and to build infrastructure in new areas, prime new areas, I think that’s where the opportunity is. The Philippines has a lot of beautiful tourist destinations that can be developed, that have been waiting for developments or investments like this. I think an integrated resort that brings in hotel rooms, world-class amenities and can help develop the local economies will be a very, very good thing to have.
AWS: Could you tell us a little bit more about the Boracay IR project? Do you have any idea of when it might open?
KLT: As I mentioned, we’re not building a large-scale integrated resort. We’re building a relatively medium-scale one, a boutique one, if you want to call it that. It’s a very sustainable design. Nothing too massive or too grand because we are very cognizant of the fact that we want to preserve how pristine the island is right now, so we’re not building anything too crazy. It will be a freestanding resort with a few villas around it, so this concept will be a little bit more of a sprawling concept – very different from what you see in the market today and very interesting. But we also have 1,500 room keys built in the township.
AWS: You’re currently working on the Westside City project in Entertainment City and I understand that one of your personal goals there is to make Westside like the “Broadway” of the Philippines?
KLT: Yes, that’s the goal. We think the Philippines is one of the most talented of all cultures. When you talk about playwrights, about the stage, about performing arts, well a stage is a stage. There’s only so much you can do. So it’s all about content, which is what the Filipinos are very, very good at.
What is currently lacking in our country is the infrastructure for this. There are shows left and right, here and there, but they’re generally very fragmented. What we want to do is put them all together in one place like a Broadway or a West End. The idea is to initially have four theaters of different sizes to be anchored by the Grand Opera House, which is our 2,000-seat opera-style theater – but it will not only be for opera. You can have musicals there, you can have concerts there as well. It’s multipurpose. Then next to it will be three smaller theaters where you can show smaller musicals, maybe some that have finished their main run in the big theater and can then transfer to a small theater. We can also do some concerts there as well, or comedy shows. Comedy for me is a very exciting because you don’t need expensive stages. You just need one person who has good content. I mean, one of the most famous comedians in the world is a Filipino [Jo Koy] in the US and he can pack an entire arena just himself. So, I think that’s also one area we would like to develop and make it part and parcel of this Broadway of Asia concept. I think that can be a very, very big draw for tourists in this country.
AWS: There is no doubt the integrated resort industry across Asia is growing rapidly with new IRs popping up all over the region. That’s putting a demand on talent at all levels, from the very top all the way through to line staff. What is your company doing to develop homegrown Filipino talent and people who can excel in this industry?
KLT: Yes, that’s always been a problem. The Filipinos are pretty much the most in demand in terms of a lot of different kinds of jobs, especially in hospitality. But that’s just one of them. I mean, you talk about even construction, engineering, nurses. The Filipinos are the best. We therefore have this problem all the time where we lose several hundred people every year to other jurisdictions or other markets. We felt this more so right after COVID, and after the war began in Ukraine, Europe couldn’t get Russian or Ukrainian talent so they would take a lot of Filipino talent abroad. So yes, this has been a problem. But, because it’s an inevitability, I told the team that instead of trying to fight it, why not embrace it?
What we have done is created an academy, a school, where you can actually get a certificate. We call this the Academy for Leisure and Tourism. We’ve set them up right here and we train everyone from housekeeping to hotel staff, restaurant workers, F&B people, even the dealers. Anything that you need to have, any talent that you would need for an integrated resort, we train them there and then we deploy them in our integrated resort.
The key here is to just continually train and then supply, train and supply. My hope is that for the next 12 months, we’ll probably be able to graduate about 300 to 400 students. But I really want to ramp that up because I think we look at ourselves as a talent development center. We’re not just going to supply ourselves, but maybe even other integrated resorts, or maybe even bring them to other countries as well. That’s really the vision for this particular group. But again, it’s embracing what I would like to call an opportunity in this segment.
AWS: You mentioned earlier the Newport Mansions will be the latest accommodation offering. I understand the plan is for the Mansions to open early in 2025. Can you tell us a little bit about where the idea for the Newport Mansions came from and what can we expect from them?
KLT: We basically renovated what was once called the Maxims Hotel. It was an in-house brand which was developed to service our VIP clients. We’ve done a total renovation and by early next year it will be 150 rooms. We will have about 14 villas, four of which will have their own pools, and the rest will have their own jacuzzi or garden.
It will be the newest product in the market. We’ve employed the best designers as well to be able to really come up with a product that’s very compelling, very rich and also very Filipino. I think it’s important also that we promote Filipino products, Filipino art, Filipino furniture, so that when people come here you’re giving them the whole package. You’re telling them what the Philippines is all about. We’re very excited about this and we hope to launch early next year. We’ll also have a mini pool club to go with it – again another added amenity, a feature just to make this property a bit more special.
AWS: As I spend time exploring the resort, I notice little touches here and there that are obviously sustainability initiatives. How do you view this concept of sustainability?
KLT: It’s a very important endeavor for the entire group. We have a program in Alliance Global called SustainAGIlity using the AGI acronym. SustainAGIlity plays a very huge role at Travellers. We launched an initiative called “I Love Earth” which has won several awards already. Among other things, we’re growing a lot of our own produce in-house using hydroponic farms that we’ve spread out all over the property. I believe we’re supplying at least 30% already of what we are serving in the restaurants from these farms.
We’re definitely very big with recycling, especially the solid waste. The group is already looking at things like technology that converts waste into energy. We believe that can go a long way if we can get that perfected. Then of course renewable energy is very important. By 2025, the property will use 100% renewable energy. We have solar panels all over the rooftops of the entire property which supplies a certain percentage of our needs, but we are now sourcing the rest of the energy from renewable sources. So, sustainability is a very important feature and initiative for us here at Newport World Resorts.
AWS: One of the really interesting things that’s happening right now in the Philippines is the privatization that PAGCOR is going through. Would your companies be interested in acquiring any of the properties that PAGCOR ultimately will be selling through this process?
KLT: First and foremost, I think that Chairman Tengco’s direction of privatizing the PAGCOR-owned properties is really the right move. It’s an initiative that has been talked about so many times by different administrations but it’s only this administration that is taking this very seriously and making the moves to be able to create the right atmosphere or environment for this to happen. To answer your question, absolutely, we are very interested to look at some of the properties. In fact, we have already started groundwork in studying some of the properties, especially the ones that are located where our townships are. These are mostly outside Metro Manila.
We definitely see a lot of potential in the PAGCOR properties but more importantly, we also see potential in the region where they’re located at, so we probably be be one of the first to show serious interest in this endeavor and we are starting to look at it as we speak.
