Inside Asian Gaming

inside asian gaming October 2014 18 In Focus Street Kitchen there. Each IR has more than 60 F&B outlets, everything from fine dining to fast food. MBS reported F&B revenue of $92.7 million in the first half, down fractionally from a year earlier, representing 22.4% of its total non-gaming revenue. RWS doesn’t break out those and other non-gaming numbers, but given the comparable range and number of outlets, it’s likely the results are close. In retail, MBS has the decided advantage. The 800,000-square-foot Shoppes at Marina Bay Sands boasts more than 300 outlets and revenue in excess of US$150 million annually at high profit margins. By contrast, RWS has just 31 shops in its retail area, plus souvenir outlets at its various attractions, and delivers perhaps one-tenth of the mall revenue. But location likely influenced that development choice. Last year, the resort joined public- and private-sector interests on Sentosa to form the Sentosa HarbourFront Business Association to promote the island. HarbourFront features more than 1 million square feet of retailing at VivoCity, Singapore’s largest mall, and at the HarbourFront Centre, and it includes the city’s largest nightlife center, Saint James Power Station, with six distinct venues. RWS has no nightclubs— in the early stages of development it tried to lure Saint James impresario Dennis Foo there—but it now designates Saint James as its club hub. Digging deeper into the retail at MBS, first-half revenue was $78.8 million, up 8.6% from a year earlier and comprising 19% of total non-gaming revenue. Mall occupancy The Shoppes at Marina Bay Sands boasts more than 300 outlets and revenue in excess of US$150 million annually. Resorts World Sentosa has just 31 shops. But last year, it joined public- and private-sector interests to form the Sentosa HarbourFront Business Association. was 89.5%, held back by about 44,000 square feet undergoing a “new fit-out as part of an ongoing repositioning of the mall that will bring in several new key luxury tenants,” LVS writes in its quarterly US earnings filing. In 2013, the occupancy figure was 86.7% with 56,000 square feet undergoing renovation. Rents of US$220 per leasable square foot, up 0.5% from a year earlier, plus about $72 in mall charges, are comparable to those of Singapore’s so-called suburban malls, but below the $329 per square foot commanded in the prime Orchard Road shopping district. Sales per square foot fell 3.5% to $1,497, reflecting a downtrend throughout Singapore. After operating expenses, taxes and provisions for unpaid rent, the business generated for MBS a profit of $60 million at a juicy 76.2% margin. Total Hospitality Group CEO David Chernov, who worked on the openings of brand-name nightclubs Avalon and Pangaea at MBS, says luxury brands permeate the mall and the entire resort. “Marina Bay Sands has teamed up with some of the world’s top brands and eating from the world’s best chefs,” he observes. While brands dominate the luxury market throughout Asia, Mr Chernov believes, “It’s more so in Singapore due to the wealth they’ve accumulated.” Indeed, Singapore has more US dollar millionaires per capita than anywhere in the world, an estimated 15% of the population. Although the IRs are supposed to be tourist- focused, there’s no doubt that local patronage plays a big part in both the gaming and non- The Sands Expo and Convention Center at Marina Bay Sands