Oppa’s bold bet on Clark pays off
Korean entrepreneur Dae Sik Han was not impressed by Clark, Pampanga, when he first came to visit in 2005 to play golf with a business partner to entertain clients.
Accommodations in the Angeles City area were sparse and there was not much happening in and around the former Clark military base.
“It was kind of quiet,” recalls the 55-year-old Han, “I stayed in a hotel but I was very disappointed by the ambiance, the surroundings. So my first impression was not very good.”
His second, however, revealed a far different picture, one that showed the vast business opportunities just waiting to be tapped.
Perhaps it was destined that he would take a closer look as today, Hann Philippines Inc. is coming into its own as a major force in the local gaming and hospitality sector.
Taking a second look
Hann Philippines is the owner and operator of the Hann Resorts brand of luxury integrated resort developments in the country with the Hann Casino Resort in Clark Freeport Zone, Pampanga, as its maiden project.
The 11-hectare (ha) property includes the first five-star luxury hotel in Central Hotel, Clark Marriott, as well as the first Swissôtel in the Philippines. The development originated as Widus Hotel and Casino in 2006.
Han tells the Inquirer that he decided to study the area’s prospects more closely as he realized that the Philippines is the nearest tourist destination to Korea, whose high-income population is constantly looking for places where they can enjoy the beach and play golf.
Thus, instead of just being a tourist, he took it upon himself to become an investor.
The time was also right as the business administration graduate of Western Michigan University was looking to strike out on his own after taking care of the family business set up by his father, who had put up an asphalt and batching plant.
He earned handsomely from real estate in Korea but he was itching to venture farther out.
Before basing himself in the Philippines to manage his investments, Han was the president and owner of Seewoom Construction Co. in South Korea. He was also the president of Hanil Ascon Co.
“Clark kept lingering in my mind so from January 2006, I decided to study a little further,” says Han.
After evaluating the risks and his own capacity to bankroll his venture, Han decided to invest the capital that he got from selling his real estate holdings in Korea plus capital from his father in the Widus Hotel and Casino, the first tower of which opened in August 2008 after renovating and upgrading the site that used to be another casino.
He shares that his father believed in him enough to lend capital but that he was not entirely convinced that he was making the right decision considering that he knew nobody in the Philippines and there were cultural differences.
It did not take long for Han to question his own decision to risk it all in the Philippines as Widus’ occupancy was a minuscule 5 percent during weekdays and up a bit to 7 percent on weekends.
“I almost went bankrupt,” recalls Han, whose timing could not be worse considering that the global economy was in the grip of a financial crisis triggered by the subprime housing crisis in the United States.
His fortunes turned in 2009 when he was granted a license to operate a casino. It was the lifeline that he badly needed as for at least six months before he opened the casino, he was not able to give a service charge to his staff.
He was eventually able to give them all their due when revenues finally started coming in, starting from 23 tables and 123 slot machines.
From tourist to investor
Today, Hann Casino Resorts is the largest revenue-generator of Pagcor (Philippine Amusement and Gaming Corp.) outside of Metro Manila, raking in P11.9 billion in 2023.
He is proud to say that his father, a self-made man whom he considers his mentor, is proud of him and happy that he stuck to his guns and proceeded with the casino and the aggressive expansion into other fields to build the Hann brand in the Philippines.
As it is, Hann Philippines is one of the top locators in the Clark Freeport Zone and was given the Top Investor, Top Income Generator, and Top Employment Performance awards during Clark Development Corp’s 30th anniversary last year.
Han intends to further build on those accomplishments as more developments come onstream.
“My father asked my why did I want to invest more? I said it was not to make more money but to survive. I have to be strong enough to compete against the others,” says Hann, who believes that he is up against increased competition as more local and foreign investors appreciate the potential of Clark that the Marcos administration is bent on building as a thriving business and entertainment district.
“When I opened Hann Casino, more people wanted to check what’s happening here and see if they can step into the market, too,” he says.
To stave them off, Hann is ready and willing to make the bold and necessary steps.
Marriott, for example, is the first five-star hotel brand in Clark and Hann is the first integrated resort. Banyan will also be the first in the Philippines. Most recently he had signed a contract to host the first LPGA tour in the Philippines.
“I always want to be first mover,” says Hann.
His belief is paying off and he is fulfilled seeing his grand vision turning into reality and he is excited about the hosting of the LPGA tournament, another example of how he wants to make Hann different. Being different, he stresses, is key to survival in the high-stakes integrated resort development space with golf as the anchor activity.
“If you are a golfer or a casino player then you have to be here at Hann. That is the way to expand the market,” he stresses.
He explains how when Solaire opened in 2013, the casino operations of its rivals got hit because Solaire offered a better quality experience.
Hann Casino’s operations, on the other hand, actually went up by 7 to 10 percent because he offered the market something new and has found a niche among golfers from across the region who in turn attract high rollers.
Indeed as of the end of last year, casino operations are more than twice the numbers before COVID-19 struck, as additional facilities came online. Koreans so far remain the biggest foreign visitors, accounting for 90 percent of international players.
But as a whole, some 60 percent of the take still comes from locals who also enjoy the chance to go outside Metro Manila to not just play but also take advantage of the food offerings and just the chance to get out of the crowded metropolis.
In 2022, he further expanded into Tarlac, with the development of Hann Reserve, a pioneering master-planned, luxury mountain resort and mixed-use development across 450 hectares of prime property in New Clark City, Tarlac.
To be developed by Hann Philippines subsidiary Hann Development Corp., Hann Reserve is the first of its kind in the country.
It will include the award-winning Banyan Tree luxury hotel and residences plus an 18-hole mountain golf course by Nicklaus Design—the first of three world-class courses and PGA-affiliated player development facilities that will form the highlight of the integrated resort.
The Hann brand
Hann Reserve’s first phase will also include a clubhouse and 10-hectare public park along with other ancillary facilities. The earliest targeted completion for the initial components of the first phase is 2025.
Hann says so far he and his partners have spent $700 million and estimates that the whole development that is envisioned to “solidify the reputation of Clark as an important leisure and lifestyle destination not just in the country but in the region” will cost as much as $10 billion.
These will all be under the Hann brand that goes by the “play bold, live bold” slogan, which, he said, explains what they have done so far against the odds.
“From 2008 when the first hotel was really bad, and I wanted to sell and nobody wanted to buy, and now, 17 years later, this is what we have,” says Hann, who spends most of his mornings from 8 a.m. to about noon to check on the progress of the Hann Reserve.
“I spend a lot of my time, maybe 50 percent of my time, on the development. That does not mean just construction but also detailed planning. When we walk around and see if there are any concerns and try to come up immediately with the solutions for them,” he says.
Hann is pulling out all the stops to make the Hann Reserve and the Hann Group top class as he wants to compete against other gaming enclaves in the region. Neither does he want to rely heavily on the local and Korean markets, which have been bringing in the revenues for the past few years.
“Nothing is forever,” he says, “Even though I know the Korean market is strong now and may still be strong over the next five to 10 years, we have to develop other markets. That is why all the brands are known internationally. They are recognized,” he explains.
Hann says he is fortunate that he has been able to develop enough of a track record to win the support of investors as well as bankers.
Recently, Hann Philippines Inc. signed a P9-billion syndicated term loan agreement with Asia United Bank Corp. and Union Bank of the Philippines to help bankroll the ongoing construction and development of Hann Reserve, which recently launched the next golf course development with South Korean pro golfer KJ Choi.
The third golf course is a river course designed by legendary former World No. 1 golfer Sir Nick Faldo, which broke ground last November 2022 and is slated for completion in the latter part of Hann Reserve’s second phase by 2028.
The entire Hann Reserve development cost is about $3 billion, with its first phase already underway with an initial cost of P9 billion. And more will be spent as he bets big on the Hann developments.
“It is very risky to invest, but doing nothing is the worst risk of all,” says Han.