Macau casinos deal themselves a tough hand with big non-gaming investment pledges

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HONG KONG — As casinos in Macau begin new licenses to operate in the world’s biggest gambling hub on Jan 1, the stakes are high on whether they will be able to successfully deliver on a government mandate to diversify away from their cash-cow: gambling. For the last 20 years, Sands China, Wynn Macau, MGM China, Galaxy Entertainment , MGM...

A man wearing face mask walks in front of Casino Lisboa, operated by SJM Holdings during the coronavirus disease pandemic in Macau, China, Dec 29, 2022.HONG KONG — As casinos in Macau begin new licenses to operate in the world’s biggest gambling hub on Jan 1, the stakes are high on whether they will be able to successfully deliver on a government mandate to diversify away from their cash-cow: gambling.

The recent easing of coronavirus restrictions in mainland China and Macau in December has also resulted in a wave of infections across the city, including many staff.Casinos have committed to investing a total of US$15 billion in the coming decade, 90 per cent of which must be spent on non-gaming. “Contrary to the vaunted Las Vegas model, non-gaming in Asia does not carry the same profit margin as spending behaviour is quite different over here,” Lee said, while adding that Galaxy, Melco and Sands were likely to fare better at diversifying based on their track record and management team.

In December, following the formal awarding of their contracts, casinos unveiled non-gaming plans including indoor waterparks, health and wellness centres, art exhibitions and a large garden attraction by Sands, similar to Singapore’s Gardens by the Bay.Macau’s current non-gaming attractions have focused on retail and dining, with some entertainment offerings such as Melco’s nightclubs, Galaxy’s cinema, Sands’ themed Venetian and Parisian properties and its exhibition arena.

Compounding casinos' challenges, Macau lacks connectivity with international markets, has dilapidated infrastructure and a shortage of skilled labour, as well as reputational damage over its Covid-19 management, executives said.

 

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Macao casinos deal themselves a tough hand with big non-gaming investment pledges: AnalysisHONG KONG: As casinos in Macao begin new licenses to operate in the world’s biggest gambling hub on Jan 1, the stakes are high on whether they will be able to successfully deliver on a government mandate to diversify away from their cash-cow: Gambling. For the last 20 years, Sands China, Wynn Macau, MGM
Source: ChannelNewsAsia - 🏆 6. / 66 Read more »

Analysis:Macau casinos deal themselves a tough hand with big non-gaming investment pledgesHONG KONG : As casinos in Macau begin new licenses to operate in the world’s biggest gambling hub on Jan. 1, the stakes are high on whether they will be able to successfully deliver on a government mandate to diversify away from their cash-cow: gambling.For the last 20 years, Sands China, Wynn Macau, MG
Source: ChannelNewsAsia - 🏆 6. / 66 Read more »