Melco to open mass-market Macau casino in October
MELCO Crown Entertainment plans to open a $3.2bn casino in Macau on October 27, joining in a competition to lure Chinese tourists amid a downturn as high rollers vanish.
Melco, controlled by billionaires Lawrence Ho and James Packer, and other Macau gambling houses are spending $27bn to build new resorts and tourist attractions to woo holiday makers as China’s slowing economy and graft crackdown keep high rollers at bay. That has led to a 14-month downturn.
“Macau is going through a transitional phase from a very VIP gaming-centric market to more mass focused,” Mr Ho, co-chairman of Melco Crown, said in an interview in Macau.
“It’s probably going to be a rough second half.
“Hopefully with Studio City opening it would be a new catalyst for the market.”
Studio City, opening in Macau after new projects by Galaxy Entertainment Group in May, is a Hollywood-themed resort with Asia’s highest Ferris wheel and family entertainment developed with Time Warner.
Melco paid $70m to make a promotional film directed by Martin Scorsese and starring Robert de Niro, Brad Pitt and Leonardo DiCaprio.
The resort will have a flight simulation ride with Batman flying through Gotham City and a 3,700m² indoor play centre with rides and other interactive facil- ities featuring DC Comics characters such as Daffy Duck and Bugs Bunny.
Melco is “actively” in talks with the Macau government on gaming table allocation for the new project, and is hoping to get 400 of them, Mr Ho, the son of 93-year-old Macau gambling mogul Stanley Ho, said.
He was “very concerned” about a scenario in which the project did not get that number of tables. “We hope the government will reward us more, for the hard work we have put in over the last 10 years,” he told a news conference.
Gaming would always be the financial engine for Melco Crown, while nongaming amenities were an additional draw, he said during the interview.
Studio City, Melco’s fourth casino with about 1,600 new hotel rooms, will also have a theatre for magic shows, a 5,000-seat entertainment centre and a TV production studio. The resort is situated next to the Lotus Bridge, which links to the developing Hengqin island in China’s Zhuhai city.
“The combination of new entertainment attractions will really focus on the mass market and goes beyond most of the other properties that still have a core of just casinos and shopping,” Bloomberg Intelligence analyst Tim Craighead said.
The new resort in south of Macau’s Cotai district follows Galaxy’s opening its expanded and revamped projects in May, the first in Macau in three years.
Billionaire Steve Wynn, who last week announced his new casino for March 25, said he finally felt confident to set an opening date for his second project in Macau after the local government approved the number of workers needed to build the resort. Sands China chairman Sheldon Adelson said its new $2.7bn Parisian resort would open in a year.
Macau relaxed travel rules from July 1, allowing Chinese nationals to stay in the city longer and more frequently.
The government has also proposed a comprehensive smoking ban inside casinos, extending the law to cover VIP rooms and abolishing airportstyle smoking lounges on mass market gaming floors.
Mr Ho said he hoped “the tide is turning” and that the government would announce more policies to support the casino industry after a year of restrictive measures.
Melco is scheduled to announce second-quarter earnings today.