Melco Resorts & Entertainment has officially dropped plans to divest its stake in City of Dreams Manila, signaling renewed strategic confidence in the Philippines’ integrated resort (IR) market.

The reversal comes after months of strategic review during which Melco had explored monetisation options for the Manila asset as part of broader capital allocation optimisation. However, improving operational trends and long-term growth visibility have prompted the company to retain ownership.

Lawrence Ho: “A Core Part of Our Regional Portfolio”

Chairman and CEO Lawrence Ho addressed the decision, emphasising Manila’s continued strategic importance within Melco’s diversified footprint.

In remarks accompanying the update, Ho stated:

“City of Dreams Manila remains a core part of our regional portfolio. The Philippines offers compelling long-term growth opportunities and we are confident in the property’s ability to deliver sustainable returns.”

He further highlighted that operational momentum and improving tourism dynamics supported the decision to halt divestment discussions.

Ho’s comments align with broader regional data showing Southeast Asian gaming markets stabilising after pandemic-era disruptions, with premium regional visitation steadily returning.

Why Melco Changed Course

Multi-source industry analysis points to several contributing factors:

1️⃣ Strengthening Philippine Tourism Recovery

The Philippines has experienced a gradual rebound in inbound arrivals, particularly from Northeast Asia and regional ASEAN markets. Entertainment City continues to benefit from improved air connectivity and leisure demand.

2️⃣ Improved Earnings Visibility

Analysts note that margins in the Philippine IR market have stabilised as operating costs normalise and premium-mass segments gain traction.

3️⃣ Portfolio Diversification Strategy

Retaining Manila reduces concentration risk on Macau, where concessionaires face reinvestment commitments under the updated regulatory framework. The Philippines provides geographic and regulatory diversification.

Competitive Landscape in Entertainment City

City of Dreams Manila competes alongside major IR peers including:

• Okada Manila

• Solaire Resort

Industry observers note that the Philippine gaming tax environment remains comparatively competitive in the region, while domestic gaming demand has grown more resilient over recent years.

Melco’s decision to retain its stake suggests confidence not only in market recovery but also in its ability to maintain competitive positioning within Entertainment City’s evolving ecosystem.

Broader Asia-Pacific Implications

For Asia gaming investors and policymakers, this development signals:

• Large-scale IR operators are no longer under immediate pressure to deleverage via asset sales.

• Southeast Asia remains a structural growth pillar beyond Macau.

• Capital discipline now means selective reinvestment rather than retrenchment.

The Philippines’ IR sector appears to be entering a consolidation phase rather than a correction cycle.