ZAPE retail rents halve as satellite casino exit weakens demand

[Photo: Lynzy Valles]

The retail property market in the ZAPE district has fallen further into strain following the full withdrawal of satellite casinos at the end of last year, with rents in some locations reportedly falling by as much as 50% to 60% as demand weakens and vacant units linger.

According to local property agents, the impact of declining foot traffic has been uneven across the district. Shops located closer to major casino resorts such as Grand Lisboa and Lisboa Hotel have remained relatively stable, supported by sustained tourist flows linked to nearby integrated resorts.

However, businesses further away, particularly near areas such as Dr. Carlos d’Assumpção Park and Comendador Ho Yin Garden, have been hardest hit.

With satellite casinos no longer operating, the flow of gaming-linked visitors has largely shifted elsewhere, while weaker spillover demand from nearby office and residential zones has further constrained recovery.

Local property sector representative Wong Sai Fat, vice chairman of the Macau General Association of Real Estate, said the ZAPE market has become increasingly segmented since the second half of last year. He noted that while some prime locations continue to benefit from stable hotel-driven traffic, other parts of the district are struggling to attract tenants even after substantial rent reductions.

“In some cases, rents have been cut by 50 to 60%, but units are still difficult to lease,” he said, adding that uncertainty over the area’s commercial outlook has made tenants cautious.

A large retail unit of around 3,600 square feet near Comendador Ho Yin Garden, which previously commanded rents of up to MOP200,000, has seen asking rents reduced to about MOP90,000 without securing a tenant. In another case, a smaller unit that once rented for MOP100,000 has fallen to around MOP30,000 in recent transactions.

Agents said many tenants remain reluctant to commit even at lower prices, citing weak consumer traffic and limited visibility for recovery. With many existing leases still in place, the full impact of the satellite casino closures has yet to be fully reflected in the market.

Industry observers expect further downward pressure on rents as leases expire over the coming months, with some businesses likely to exit the area if conditions do not improve.

Despite falling rents, ZAPE is not necessarily becoming more attractive for new entrants.

Analysts said retailers are increasingly shifting their preference toward areas such as Taipa, where population density and consumption activity are stronger, even if rental costs are higher, due to more predictable business conditions.

Last month, the Macau Government Tourism Office (MGTO) said it will spearhead a range of measures focused on ZAPE, including collaboration with key online platforms to create a page dedicated to Macau travel and offering hotel deals in the district, though the specific platforms were not named.

This effort follows the closure last year of satellite casinos in, which led to a considerable drop in both visitor numbers and revenue for nearby hotels and businesses, particularly smaller ones.

Recently resigned Secretary for Economy and Finance Tai Kin Ip has also recently reiterated that authorities are closely monitoring the impact of the satellite casinos’ closure on surrounding commercial districts and are actively promoting the creation of new retail experiences in the ZAPE area.

He said the government will continue to monitor the conditions there, including rent adjustments.