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staff that they’re going to have an easy job, so let’s make sure we have the right people in place. The phones will be ringing off the hook.” Singapore has long been a MICE destination in Asia with the Suntec

Convention and Exhibition Center, and Arasi says Marina Bay Sands makes it the premier city to host meetings. “While I believe we are very complementary to the public meeting space, we

are truly the ideal space in Singapore,” he says. “We have 2,000 rooms and suites connected to the meeting space. When your meetings are done, you don’t need to travel to the entertainment district. It’s self-contained at the Marina Bay Sands. We’ve got the exhibit space, ballrooms and meeting facility all under one roof. We can house citywide-size events under one roof. We will give an excitement, a buzz and an experience that you can’t find anywhere else in Singapore.”

MARKET FORCES

Since the aspiration of the Singapore government was to increase tourism to the city via more family entertainment and MICE business, it’s clear that the two casi- nos must work together to achieve that goal. Leven says the market is strong and vibrant, so that neither casino has to fear

competitive pressures from the other. “The market is so big and vibrant. There’s plenty of business for both casinos,”

he says. “It’s a duopoly for 10 years, so I don’t think we’ll have any problems with the market during the period. There’s plenty of room in the market for both of us.” Arasi says there have already been discussions on cooperation between the

casinos. “We will work with not only Resorts World, but the other hotels and attrac-

tions and the Singapore tourism authorities,” he says. “This is to a very large degree about selling Singapore and how we can participate in things that are good for Singapore. If we’re effective, we’ll all get our fair share. Within that context, we think we can do very well.” Another Singapore stipulation is an aggressive problem gambling effort. Arasi

says this was an easy piece for LV Sands to comply with because the corporation had an in-house program that is a success in its other properties. “We have an industry-leading model,” he says. “We’ve done everything from

the original research to the treatment. We’ve extended responsible gaming training to everyone at Marina Bay Sands, and that training will be ongoing as we continue to evolve and understand the problem more completely.” And the minimization of social problems is also an area where LV Sands will

work hard to shine. “We have a very specific set of targets to shoot for, because the way Singapore

has laid out the model,” he says, “you’ll have all the social safeguards which are strictly controlled. It’s quite a transparent process that we’ll be able to build our program around.”

CORPORATE IMPACT

While the Las Vegas and Macau developments of Las Vegas Sands are impressive and successful, Leven says it is Singapore that will tell the tale. He’s confident that the property will live up to expectations and truly become a transformative moment for the company. The goal of increasing non-gaming spend may take a while to move into place, but even so, Leven believes the gaming revenues will be enough to achieve success.

26

“Based on the numbers we’re seeing at Resorts World and what we expect to

see at Marina Bay Sands, I think it’s going to take a couple of years to reach the 65-45 mix that we have anticipated,” Leven explains. “The casino business in the early going is going to dramatically exceed the MICE business and the room business. First of all, they’re all not going to be ready immediately, and then there’s a booking cycle that takes a while to kick in. So I think it’s going to be well into 2012 before that starts to level off. You can’t sustain these kinds of buildings without the gaming revenue. I’ve been in the hotel business long enough to know something about that income. The casino business is likely to be 75 percent to 80 percent of the EBIDTA revenues, certainly for the first seven months, and likely for the first full year as well.” The monetary return on the project is just one benefit it will bring Las Vegas

Sands, according to Leven. “You can’t underestimate what this project does for the company,” he says.

“This project will lead us to opportunities that may have never come to this company before—Japan and other countries that are considering gaming. They look at this and they are going to say, ‘This is what I want. I don’t want a casino just for locals. I want to drive tourism.’ Countries that restrict local players like Korea will see a place like this and understand that you can include local players and that the rest of the business that is driven in will create jobs, taxes and other benefits. That will give us the opportunity to go forward. “Sheldon and I have already visited Japan twice. We’ve talked to various

potential partners over there. One of those meetings came from someone who had actually visited the property in Singapore. We’ve had calls from Vietnam, which has a bit of a drawback because they don’t want their citizens to gamble. We’ve talked to Korea, and then there’s also some European talk. There will be more once Singapore is open. India is a possibility. We’ve had discussions about the Mumbai area.” While Adelson has described Las Vegas Sands now as an “Asian company,”

that doesn’t mean that he’s given up hopes of developing integrated resorts in the United States. “A facility like this in Florida—in the Dade/Broward County area—would be

a lot better for the state than that deal they just made with the Seminoles,” says Leven. “That will put some money in the state budget coffers for a few years, but it won’t have a long-range significance. And an integrated resort in Florida wouldn’t cost us as much as the Singapore project did or one in Japan would.” And even though Adelson and Leven are Boston natives, Leven doesn’t

believe there is opportunity for the company in the Bay State. “Massachusetts has some problems,” he says. “You need to be in a location

that is favorable and there are weather problems nine months of the year. We’ve had those conversations. If you’re not contiguous to Boston and that infrastruc- ture, you can’t expect to drive enormous midweek convention business.” For the immediate future, however, the attention of LV Sands will be devot-

ed to Singapore (and to Macau; see sidebar on page 28). Leven believes that the phased openings will allow the company to develop a feel for the different ele- ments of the property. “By the winter of ’11, all aspects of the property will be up and running,” he

says, “with the possible exception of a few MICE elements still to open. But by a year from the opening—by June of ’11—we should have a full building operat- ing at peak efficiency.”

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