The Parisian, the latest addition from Sands China to the company’s portfolio in Macau, opened its doors yesterday in a ceremony presided over by Las Vegas Sands chairman and chief executive officer, Sheldon Adelson.
The MOP24 billion project, which took five years to be built, is carrying hopes of great success in times that some, like Adelson, say are “the end of the downturn [of gaming revenues].”
Commenting on the potential of the territory in terms of revenue and taking as reference the latest results for August 2016 – when the gaming industry finally left negative growth territory after 25 months and registered positive growth of 1.1 percent, Adelson said: “Now, is it sustainable for a long time to come? I can’t answer that question, but based upon the pre-bookings we have, based upon the convention bookings we have, I think we have essentially hit the bottom.”
The LVS chairman recalled having made such a prediction about seven months ago. “Macau still has very good days to come and I can’t predict what the percentage of growth will be but I am optimistic about the future,” he added.
“With the opening of the Parisian tonight we have completed the available land and parcels for what I call the Cotai Strip,” Adelson remarked, putting voice to his wishes for an even bigger expansion.
“Actually I wanted 20 properties but we only got six plots. We are very happy with this, we are not unhappy,” Adelson explained. He recognized however that his “dream” for Cotai was not always that clear.
“When the government sent me out to Cotai I frankly thought they were exiling me because the bigger activity and the gaming resorts were on the peninsula,” he said. He claimed that because of what was necessary to accomplish to construct the properties that today stand in Cotai, the achievement attained with the opening of The Parisian is even more important.
“This is the only place in the world (that I know of) that you can go under one roof to 13,000 rooms and suites, close to 900 retail shops, two and half million square feet of MICE venues,” he remarked, reaffirming a bet on non-gaming elements.
Adelson additionally remarked that the non-gaming services on offer will expand with facilities. In the Parisian, the offer includes a new amphitheater with capacity for 1, 200 people. The CEO further announced, “we have another [theatre] that is going to open within a couple of months in Sands Cotai Central where the Pacifica Casino is.”
For the Las Vegas Sands CEO, the main drivers of the local economy in the near future will be the completion of two big projects, one at the regional level (the Hong Kong-Macau-Zhuhai Bridge) and another at the local level (the Light Rail Transit).
According to Adelson, the two projects will greatly improve mobility within and accessibility to the territory, especially the HMZB that “will provide access to two international airports within 20 minutes.”
Questioned on how long he expects it will take for the Parisian property to “break even,” the gaming tycoon said, “we hope it is one year but I might be disappointed if it is over four years. I just hope it is sooner rather than later.” His comment was in reference to the break-even timeframes achieved by the company in previous developments (Sands Macao and The Venetian Macao).
During the press conference held prior to the opening, Sands China’s president and COO, Wilfred Wong, highlighted the excitement of the whole team in opening the new property.
“All of us here, close to 30,000 team members, were so excited that everybody wanted the building to be open yesterday,” he said.
Wong also remarked on the importance of “belonging to Macau.” “In our company the policy has always been to groom the local people as far as we could,” he said, claiming that in the 12 years since the opening of Sands Macao, the management team of Sands China has increased its proportion of local employees from 7 to over 85 percent. RM
Looking for investment opportunities
With the completion of the Parisian, Sands has finished developing all its land in Macau, bringing its total investment in the city to between USD13 billion and USD14 billion. The company will now focus on looking at opportunities elsewhere in the region to build new casino resorts, Adelson said. “There doesn’t seem to be too much more growth here,” he said.
“We are aggressively and continuously, let me call it lobbying for other locations throughout the Asia-Pacific countries. We’ve been looking at Japan, Korea, Vietnam and Thailand,”said Adelson.
“We have some ideas for additional growth here in Macau, but not any major integrated resorts like the opening of Parisian today,” he added. “I do look at Europe, to build a Europe Vegas, but we couldn’t negotiate the kind of terms we needed.” Back in 2013, the LVS chairman had said he was considering building integrated resorts in major European cities, after abandoning a plan for a $30 billion mega-resort in Spain. Gambling liberalization has also proceeded slowly elsewhere in Asia. AP/Bloomberg