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Veremonte could quit BCN World project if definitive Urban Planning does not fit expectations

Veremonte has added additional uncertainty to the future of the BCN World project, the largest holiday resort in Europe based in the Costa Daurada, near Tarragona. After a $6 billion investment, it will include – among other facilities – 6 mega-casino hotels, amusement parks and shopping malls. Veremonte – which was initially leading the project – announced that it could leave, depending on how the Catalan Government will develop the final Urban Plan and how it will set the conditions for the second phase of the casino licences' tender. In 2012, Veremonte had already reached an agreement with La Caixa bank to buy 500 hectares of the land. However, the company missed the first deadline and did not meet the second one (last December) to do so, arguing that the final Urban Plan had not yet been approved. The Catalan Government then jumped in and reached an agreement with La Caixa for the rights to buy the land and guarantee the project's continuation. Veremonte still continues to be linked to the project through the casino licence tender, for which it is running with Hard Rock and Melco.

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21 May 2015 09:19 PM

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ACN

Barcelona (ACN).- Veremonte has added additional uncertainty to the future of the BCN World project, the largest holiday resort in Europe based in the Costa Daurada, near Tarragona. After a $6 billion investment, it will include – among other facilities – 6 mega-casino hotels, amusement parks and shopping malls. Veremonte – which was initially leading the project – announced that it could leave, depending on how the Catalan Government will develop the final Urban Plan and how it will set the conditions for the second phase of the casino licences' tender. In 2012, Veremonte had already reached an agreement with La Caixa bank to buy 500 hectares of the land. However, the company missed the first deadline and did not meet the second one (last December) to do so, arguing that the final Urban Plan had not yet been approved. The Catalan Government then jumped in and reached an agreement with La Caixa for the rights to buy the land and guarantee the project's continuation. Veremonte still continues to be linked to the project through the casino licence tender, for which it is running with Hard Rock and Melco.


On Thursday, sources from the company confirmed to ACN that "so far, they are still in". The Catalan Government assured that the final Urban Plan is likely to be ready at the beginning of July and that the entire project is "very much alive and progressing". "We are waiting" to see what happens, stated Veremonte. However, this Thursday's announcement can be interpreted as a warning signal and even as a way to pressure the public bodies defining the final Urban Plan for the area where BCN World is to be developed, next to the PortAventura amusement park.

Damià Calvet, Director of INCASÒL (the Catalan Government's subsidiary that manages public land throughout Catalonia) and Executive Coordinator of the resort's project, stressed that it is up to the Catalan Government to "lead and promote" the initiative now, after Veremonte stepped down from leading it. According to him, Veremonte already lost its distinguishing role in the project when it missed the second deadline for buying the land last December. "Currently Melco, Hard Rock and Grup Peralada (the three casino operators) are the ones who provide technical and financial solvency" to the BCN World resort project, he said. "They have a total commitment to it, and on behalf of the Government we maintain excellent relations with each of them", he added.

Catalan Minister for Planning stated that the Urban Plan will be approved in July

Last December, Veremonte announced that it would not buy the land to build the BCN World mega-casino and holiday resort yet, as it wanted to wait until it knew the town-planning details of the project better. The company had an exclusivity agreement to buy 500 hectares of land from La Caixa before 10 December at midnight for €380 million, but it postponed this. Then, the Catalan Government stepped in, assuming the task of managing the sale of part of the property, in particular the core part of the project where the mega casinos are to be built, totalling 150 hectares and worth €110 million. The new agreement – managed by INCASOL – is for 18 months, after which the Government will have the option of buying the land itself.

In January, Catalan public institutions also approved a preliminary Urban Plan foreseeing towers of 20 to 25 floors and the construction of 1.59 million square metres in the whole area. One month later, a commission in charge of discussing the content of the final version of the plan was created, made up by the Catalan Government itself, political parties, professional associations (architects, engineers, etc) and economic and tourism entities. Initially, it was predicted that the final document would be ready around Easter, but this did not happen. The Catalan Minister for Planning and Sustainability, Santi Vila, assured a few days ago that the final Urban Plan may be approved in July.

"The entire project is very much alive", according to the Catalan Government  

The Director of INCASÒL, Damià Calvet, remarked that Melco, Hard Rock and Grup Peralada "are totally committed to the project". Veremonte formed a joint venture with Chinese gambling giant Melco and another one with US multinational Hard Rock. They were pre-selected at the first stage of the casino licence tender. Melco ran alone as well and was pre-selected for a third licence. Veremonte ran as leading partner in a joint venture with US casino company Caesars Entertainment as well, but was not pre-selected for a fourth licence as the investment company chaired by Enrique Bañuelos could not prove its experience in managing casinos (as the leading partner of the joint venture). Another company was unexpectedly pre-selected for a fourth licence, Grup Peralada, which was not a partner of Veremonte and came as a surprise in the tender process. The process for applying for licences was divided into two phases: the first phase (held in August 2014) consisted of screening the applicants and the second (still to be held) will evaluate proposals and award the definitive licences.

Calvet explained that weekly contact is maintained with these casino companies, stressing that this week the Catalan Government will meet with representatives from Hard Rock, while last week they met with representatives from Melco. "The entire project is very much alive and progressing properly," Calvet assured.

Calvet also confirmed that the definitive Urban Plan (PDU) is still being drafted and will probably be ready in July for the approval process. It also pointed out that the commission monitoring the PDU will meet "immediately" after the municipal elections as holding meetings was not "convenient" during the electoral campaign.

The initial investment was announced in September 2012

According to the original project, the BCN World resort will consist of a strip of six Las Vegas-style casino-hotels as well as amusement parks, shopping malls, conference centres, theatres, research institutes, golf courses and a beach club (among other facilities). It will be located between the towns of Salou and Vila-seca, on the Costa Daurada. The project is expected to generate 17,000 jobs in the construction phase, and subsequently 5,000 jobs per mega-hotel.

The investment was announced in September 2012 as an alternative to Sheldon Adelson's Eurovegas project, which was to be built in either the Madrid or Barcelona area. However, in order to make BCN World happen, significant regulatory modifications were needed so as to adapt the urban planning of the area but also to modify essential aspects regarding taxation and gambling.

The Catalan elections in November 2012 put the process to modify the legal framework on hold. A parliamentary commission was created in 2013 and the centre-right pro-Catalan State coalition CiU (running the Catalan Government since 2010) and the opposition Catalan Socialist Party (PSC) reached an agreement in March 2014 to approve the new legal framework and Urban Plan. The new legal framework was approved on May 2014 by the Catalan Parliament, giving the green light to the drafting of the definitive Urban Plan and the start of construction work. According to Santi Vila's statement a few days ago, the final Urban Plan is likely to be ready in its definitive version in July.

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  • A golf course and PortAventura theme park, next to the land where BCN World should be built (by ACN)

  • A golf course and PortAventura theme park, next to the land where BCN World should be built (by ACN)