MACAU BUSINESS
Food, we believe we (Jeju) can be as big as Singapore with its Marina Bay Sands (MBS) and Resort Sentosa. Jeju will have Dream Tower and Shinhwa World, which will be 2.5 times bigger than Resort World Sentosa. Phase 1 will open this year, in December, with Four Seasons and Marriot and many others in later stages. And we will be the same size as MBS if we exclude the MICE area and differences in casino area. So, we believe in the future because total Gross Gaming Revenue (GGR) can be as big as Singapore.
Profitable in first year M. B. – How many years do you estimate for return
on investment? L. T. – We’re opening in September 2019 because
Jeju is already a very mature tourism destination for foreigners; and since we’re the one and only, the largest and tallest landmark in downtown Jeju, we expect to stabilise within a year of opening. We will market our customers directly through our tourism and duty free marketing business experience. We will try to be profitable from the first year.
M. B. – Visa-free is always appealing, right? Especially to the Chinese who will probably continue to represent the huge bulk of foreigners gambling in South Korea in general and Jeju in particular… L. T. – Right now, because Jeju has been the closest
international destination from East China and the Chinese come to Jeju enjoying a visa-free status, there’s a 30 per cent increase [in the number of Chinese] from 2009 to 2016. Of all foreign visitors, Chinese represent 89 per cent – but after we build Dream Tower, besides the Chinese we expect rapid growth from Southeast Asian visitors, and we hope the Japanese will come back [to Korea] as they used to in the past.
M. B. – What are the main marketing tools
employed to attract Chinese players? L. T. – Jeju has always been a special place for the
Chinese. It is a healing island, with the Chinese coming for a weekend through cruises but also for
golf and sightseeing. The island provides all that and more. And since we’re in the middle of downtown, we will be pivotal to all of them. With gaming.
M. B. – If the Crown problems in China taught a
lesson it was that gaming companies must pay attention to attracting gamblers on Chinese soil. Was that episode carefully followed in South Korea as well? L. T. – Korean casinos know what is forbidden in China, similar to the Singaporean and Macau casinos. Rather than doing direct marketing we hope to have more visitors from China but also from the rest of Asia.
M. B. – The interest of gaming operators, from
Vegas and from Macau, in being part of the Japanese opportunity is well known. Lotte Tour, however, even with its strong links to business in Japan through other arms of the Lotte conglomerate, is not interested in investing in a gaming licence in Japan. Why is that? L. T. – We, Lotte Tour, want to focus on Dream
Tower, trying to make it a success first. But also because the return on investment from a Japanese IR is probably not [going to be] as high as people might expect. So, we will focus on Jeju first and if possible expand with another in Seoul rather than in Tokyo or Osaka.
M. B. – All these mega resorts, however, will
continue to make just a fraction of a small casino in a remote part of South Korea. Just because Kangwon Land is the only one that can receive domestic players. Will gaming legislation in South Korea continue not allowing domestic players except those in a ski resort? L. T. – Some of the current new Korean
Government representatives have mentioned that Jeju should have the next open domestic casino. After Singapore opened its casino business and when Japan follows suit there might be a chance Korea will have another open casino. If that happens I think Jeju will be the first place to be allowed, and we will be one of the operators in Korea trying to go after that licence.
22 OCTOBER 2017
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