NAGACORP Ltd, which owns Phnom Penh’s only licensed casino NagaWorld, announced its $4 billion Naga 3 Project on the site of the former “White Building” in Tonle Bassac commune, a 29-page document filed with the Stock Exchange of Hong Kong Limited said.
The company’s announcement said the government had approved in principle the construction of the Naga 3 integrated entertainment complex in four 42-storey buildings on 7,757sqm.
The company said the government then granted another approval in principle after it bought an additional 9,080sqm plot, adjacent to the land of the former White Building, to build five blocks of buildings at a maximum height of 66 storeys, to function as entertainment establishments, hotels and apartments.
The additional land said to have been purchased by the company contains the 7NG Group Co Ltd’s head office.
7NG Development Co Ltd director Srey Chantou could not be reached for comment on Sunday to verify if the land – of unknown ownership – had been sold to NagaCorp.
The five-decade-old building with 492 families living in it was demolished in 2017 after the government, in cooperation with Japanese real estate company Arakawa Co, resolved to develop the area. The original plan was to construct a 21-storey building at a cost of some $80 million.
However, a rumour had been circulating that the property would be developed into Naga3 instead, which has now been realised.
NagaCorp expects to incur approximately $3.8-4.0 billion in capital expenditure for the development of the Naga 3 Project, according to its announcement.
The company did not disclose the price of the land. However, according to research earlier this year by the real-estate agency, Key Real Estate, the land in the area costs an average of $4,000-$6,000 per sqm.
Government spokesperson Phay Siphan told The Post on Sunday that he heard about the project through unofficial sources.
“This matter needs to go through the Ministry of Economy and Finance. As for me, I heard unofficially that the government had already approved,” he said.
However, Siphan welcomes the new development project, which he said will earn more tax revenue for the government, create jobs and boost tourism.
Mey Vann, the director-general of the General Department of Financial Industry at the Ministry of Economy and Finance, told The Post on Sunday that the ministry has not received documentation about the company’s plans.
“I heard that the company obtained approval from the government [for the Naga3 Project] but I cannot give any details as the ministry has yet to receive any documents,” he said.
An unaudited financial statement for the first three months of this year – ending March 31 – said NagaCorp generated more than $321 million in gross gaming revenue – a 32 per cent increase compared to the same period last year.
In its annual financial report for last year, NagaWorld showed a 55 per cent increase in gross gaming revenue to $1.4 billion and net profit jumped 53 per cent to $390.6 million compared to 2017. NagaCorp reported paying $8.81 million in income tax last year.
Mey Vann had previously told The Post that the government had collected more than $20 million in 2013 and 2014. However, he said the company will need to pay another profit tax for non-gaming revenue – the revenue from rooms booked, restaurants, et cetera.
NagaCorp successfully launched Naga2 late in 2017. The Naga 3 Project will be connected to the underground NagaCity Walk linking Naga 1 and Naga 2, according to the announcement.
Affiliated Network for Social Accountability executive director San Chey said casinos will be used for money laundering unless the government can properly legislate regulations.
“As anti-money laundering measures are still limited, we are worried that casinos could be used as a place for money laundering,” he said.
However, Phay Siphan said the government has the issue well under control.