70
Gaming Talk about resorts in Asia tends to
focus on iconic architecture, vast con- vention and retail spaces, and entertain- ment spectacles. In reality, Asia’s casino resorts rely on gaming for their survival, a situation that is unlikely to change in the foreseeable future. That’s the con- sensus of industry executives and other experts interviewed by Macau Business. It is also what the numbers say. On
the Las Vegas Strip, casinos get more than 60 percent of their revenue from non-gaming sources. In Macau, non- gaming revenue represents 11 percent of total revenue, according to operators’ latest nancial reports, ranging from less than 1 percent for gaming market leader SJM Holdings Ltd. to 14.2 per- cent for Sands China Ltd. In Singapore, even with gaming revenue restricted by the government’s refusal to license jun- ket operators, non-gaming registers 22.4 percent of the total. “Gaming is what drives integrated
resorts in Asia nancially but not opera- tionally,” former Marina Bay Sands chief executive of cer Thomas Arasi
says. Marina Bay Sands with its 120,000-
Talk about resorts in Asia tends to focus on iconic architecture, vast convention and retail spaces, and entertainment spectacles. In reality, Asia’s casino resorts rely on gaming for their survival
plus square metre of convention space, 300-store shopping mall, resident and touring shows, six celebrity chef restau- rants, and more than 2,500 hotel rooms, derives 24.4 percent of its revenue from non-gaming sources.
Attractive arithmetic Given the skewed revenue numbers, it is worth asking whether casino resorts are
the right model, particularly for Macau. SJM Holdings Ltd. remains sceptical. While Las Vegas has become a major- ity non-gaming market, “Macau hasn’t changed,” SJM director of operations development Niall Murray says. “We’re not going to spend millions
on entertainment, for example. Energy on the gaming oor has to be free. We don’t want to drag players off the oor for 90 minutes,” he says. Integrating a resort represents a ma-
jor challenge for operators, particularly aligning the non-gaming components to support the casino. “Non-gaming attrac- tions create the premium envelope for the gaming activities to t into,” Melco Crown Entertainment Ltd. co-chief op- erating of cer for operations Nicholas Naples says. “This is the real differentia- tor between casino resorts since most of the games within the casinos are simi- lar.”
“Keep in mind that even if only 20
percent of revenue [at Marina Bay Sands] is from non-gaming, that’s still S$772 million,” says Mr Arasi, now president and chief executive of United States-
Club Cubic nightclub - City of Dreams
CotaiArena - Venetian Macau JANUARY 2012
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