Inside Asian Gaming

inside asian gaming September 2014 10 Macau,” says GEG Deputy Chairman Francis Lui, who has a particular affinity for those consumers. A civil and structural engineer by training, he started his career in the late ’70s in the quarries of Hong Kong with his family’s construction materials business and in 1985 started doing business directly in mainland China. “If there is a person in Macau who understands what the Chinese customer will look like in the next five or 10 years it is probably somebody like me, who has been there doing business in China, seeing them evolving,” he says. His father, Lui family patriarch and GEG Chairman Lui Che Woo, is ranked the second-richest man in Asia, according to Forbes , thanks largely to the family’s 51% stake in GEG, which even after recent sharp sell-downs in Macau casino stocks has a market capitalization of more than US$30 billion, ranking it the world’s No. 2 gaming company by market cap behind Las Vegas Sands. The elder Mr Lui confirmed publicly in 2012 what was already widely known in the market—his son is in charge of the business. Earlier this year, GEGcelebrated the 10th anniversary of its operations in Macau. Francis Lui has done so well holding his own against SJM, the legendary Stanley Ho’s former monopoly, and international stalwarts Sands, Wynn Resorts and MGM Resorts International that it’s easy to forget that prior to 2004 he had no gaming experience at all. Galaxy began operations in Macau in July 2004, at the Waldo, a third-party-owned venue, one of the three casinos of the City Clubs brand that Galaxy now operates (after assuming direct ownership of a fourth, GrandWaldo, last year). But it was only in 2006, with the opening of StarWorld Hotel, that GEG’s brand identity began to emerge. Owing to the relatively small footprint and limited amenities at StarWorld, that brand-building was initially defined by a strong service mindset and an ability to forge lasting relationships with players and junkets. Those qualities, which continue to drive StarWorld’s success in a challenging marketplace, were carried through to the sprawling US$2.1 billion Galaxy Macau, which finally gave Mr Lui a platformworthy of fulfilling his vision of providing an experience imbued with a distinctively Asian flavor rather than merely transplanting the Las Vegas megaresort model to Macau. He defines his management philosophy as a mix of his Chinese upbringing and Western education. Forbes said of him: “When Lui Che Woo first won the Macau gambling license, Francis was taking business courses at Stanford University and found the casino industry in Las Vegas impressive. He noticed that the American model added entertainment elements besides traditional gambling in order to attract tourists. And during his global travels he found Southeast Asian-style service the best. It dawned on him that he could combine the two.” The US$2.5 billion Phase 2 expansion of Galaxy Macau will expand Mr Lui’s vision, growing the property from three hotels to five, widening the retail selection from 35 stores to more than 200, expanding the popular rooftop resort deck, and adding more F&B outlets and entertainment offerings. The company is also finalizing plans for phases 3 and 4 and says construction could begin as early as the end of this year, with a further investment of US$7.7 billion, focused on non-gaming facilities. Meanwhile, Grand Waldo, located near Galaxy Macau on Cotai and purchased last year for $417 million, is undergoing an extensive refurbishment and expected to reopen early next year with an assortment of all-new leisure and entertainment attractions. LimKokThay Executive Chairman and CEO Genting Berhad A decade ago, few would have pictured a Malaysia-based monopoly operator embarking on an unrivaled global casino development frenzy—a frenzy that was arguably kicked off by the Singapore government’s decision in 2005 to legalize casinos. Prior to that, since 1970, Genting had been content to earn healthy profits from Genting Highlands, recently rebranded Resorts World Genting, which continues to enjoy an exclusive casino license in Malaysia. The catchment area for RWG covers Malaysia and Singapore, so Genting’s decision to vie for one of the two new licenses that went up for bid in the neighboring city-state was viewed by many at the time as a defensive maneuver to hedge against expected cannibalization of its Malaysia operations. The company, led by billionaire Lim Kok Thay, pressed on with its bid even as other major operators, including Wynn Resorts, Melco Crown Entertainment and Caesars Entertainment, dropped out owing to the steep investment outlays demanded by the Singapore government. The cost eventually proved justified, of course, as the Lion City’s two IRs have gone on to become perhaps the most profitable casinos in the world. Although gaming revenue growth in Singapore appears to have