Inside Asian Gaming

inside asian gaming October 2014 12 diverse than ever”. This includes “more smaller destinations, for leisure trips, for investment, and also for gambling”. He expects the share of destinations outside their current Top 10 will grow from 19% to 24% in the year ahead. It’s not only gaming operators chasing this money around the globe. Outbound property investment from mainland China has soared from less than US$70 million in 2008 to $16 billion last year, according to real estate services company Colliers International. Of the top 10 listed global developers by revenue, seven of them are now mainland Chinese. Part of this is defensive, a response to the cooling of the domestic property market. But there is more to it than that. “[The Chinese are] much more active than before as they have seen the growth of Chinese travelers traveling aboard, and they think they can [cater to] this business,” said William Dong, CEO of Best Western (China), speaking recently to Hotel News Now , an arm of hospitality analytics giant STR. Gaming industry observers are familiar with Genting Group’s plans for a $4 billion China-themed megaresort on the Las Vegas Strip and major moves such as China’s Export-Import Bank’s $2.4 billion financing of the 1,000-room Baha Mar Casino & Hotel in the Bahamas. China State Construction and Engineering, the country’s largest contractor, is investing $150 million in the project. Opening is scheduled for the spring. Hong Kong-based property developer Landing International is partnering with Genting Singapore on a mixed-use resort on the South Korean island of Jeju, home to eight casinos already and a popular spot for Chinese tourists, who enjoy 90 days’ visa-free access Cover Story Gaming industry observers are familiar with Genting Group’s plans for a $4 billion China-themed megaresort on the Las Vegas Strip and major moves such as China’s Export-Import Bank’s $2.4 billion financing of the 1,000-room Baha Mar Casino & Hotel in the Bahamas. As Morgan Stanley’s Praveen Choudhary, Alex Poon and Thomas Allen noted in an October client report, “Other markets are adding capacity and marketing initiatives, including Cambodia, Philippines [etc.], and “VIP growth in those countries has started to outpace Macau in recent quarters.” Phnom Penh’s NagaWorld monopoly just came off a 20% first- half increase in rolling chip volume and is steadily adding junket partners. South Korea’s Paradise Group reports that table drop from Chinese VIPs was up almost 25% in the second quarter, accounting for a hefty 66% of total drop at the five casinos owned by the leading operator in the country’s foreigners-only market. Gaming revenue surged 56% in the second quarter at Manila’s new Solaire Resort & Casino on strong growth in VIP turnover, most of it overseas play. Junkets accounted for a reported 80% of it. The city will become an even more formidable competitor for China’s high end with the opening later this year of Melco Crown’s City of Dreams Manila Macau still ranks high among Chinese travel preferences, but CLSA expects that as destinations go it will “underperform” other locations in the years ahead, a trend which they’ve observed going back to 2005. They say the same goes for Hong Kong. But even now when the country’s high net worth individuals think of destinations Macau ranks rather low on the list. It trailed Hong Kong, Sanya, Yunnan, Tibet and Xinjiang, according to the 2013 edition of “The Chinese Luxury Traveler,” published by the Shanghai- based Hurun Report , the bible of China’s new wealth class. Wolfgang Georg Arlt, director of the China Outbound Travel Research Institute, sees “more and more Chinese spreading out all over the planet, discovering destinations and travel forms more