MACAU BUSINESS
already operates casinos in Melbourne and Perth, and is one of the two controlling shareholders of Macau-based gaming operator Melco Crown Entertainment Ltd, with a 33.7-percent stake. “Its iconic curves and fine lines celebrate the harbour and create an architectural ‘postcard’ that will help attract international tourists and assist Sydney to compete with other global destinations,” he said last month.
Prime location Mr Packer’s plan is for a six-star hotel – Sydney’s
first – and a VIP invitation-only gaming resort that will be the first in the world with no slot machines. If permission is granted, it will be constructed at the Barangaroo development site in the shadow of the Sydney Harbour Bridge, a prime harbour side location once a working dock. Wilkinson Eyre director Paul Baker said it was one of the best sites in the world to develop and the architecture would take its inspiration from nature. “Its curved geometry emanates from three petal forms which twist and rise together,” he said in describing the building. “The first petal peels off,
spreading outward to form the main hotel room accommodation, with the remaining two twisting together toward the sky.” The New South Wales state government is still considering whether to give Mr Packer’s company Crown Ltd the green light, which would require it to issue a second Sydney casino licence. Rival Echo Entertainment Group Ltd, which owns the Star casino in nearby Pyrmont, has lodged a counter-offer to expand its facilities and extend its exclusive casino licence beyond its expiry date of November 2019. The New South Wales state government gave both
Crown and Echo Entertainment until June 21 to deliver final details on their competing proposals. Recently Crown dumped its 10-percent stake in Echo Entertainment. Mr Packer said he wanted to focus on his own casino proposal, free from any association with the rival group. Since his father Kerry’s death in 2005, Mr Packer
has moved the family business away from its traditional media operations and focused on creating Crown, a worldwide gambling empire. Asian high- rollers, particularly the growing ranks of wealthy Chinese, are his target.
Last One In S
JM Holdings Ltd, Macau’s biggest casino operator by marker share, has been finally granted a piece of land in Cotai to develop a casino resort. The company expects to spend about HK$20 billion
(US$2.6 billion) on the project. The grant was published recently in the Official
Gazette. In October, SJM Holdings had already said it would need to pay the government a contract premium of MOP2.15 billion (US$269 million) for the land, which has an area of 70,468 square meters. SJM Holdings was the last company among Macau’s six gaming operators to receive official approval to develop a casino resort in Cotai. It filed its initial request in 2006. The company currently runs 17 casinos here, the
SJM Holdings is the last gaming operator to receive official approval for a Cotai casino resort
majority operated by third parties. The late start is unlikely to be a major drawback,
says Macquarie Capital Securities Ltd, an affiliate of global financial institution Macquarie Group. “We believe that table constraints in the market are
going to start becoming increasingly apparent as the Macau government continues to abide by its table caps. This will make SJM Holdings’ excess number of tables all the more attractive,” analysts Gary Pinge and Roger Tse wrote in a note. “These tables have been underutilised to date because of the fact that they are housed in older properties within Macau,” they added. “However, as SJM Holdings builds its property on Cotai, it will be able to move these low performing tables into better properties, thereby increasing the yield on the tables.”
Joining forces
SJM Holdings expects to break ground in Cotai this year. Construction should be completed by between
JULY/AUGUST 2013 21
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