Inside Asian Gaming

inside asian gaming September 2015 16 construction of Lisboa Palace made “good progress” in the first half, the company says, with foundation work essentially completed and the building of the superstructure and basement levels now “well under way”. Management is shooting for a debut of the HK$30 billion super-resort (US$3.85 billion) in the second half of 2017, which means it will be the last of the new resorts to open on Cotai. But when it does, SJM will possess the fully integrated resort offering it has lacked up to now. The prospects are exciting. Lisboa Palace will feature more than 521,000 square meters of gross floor area, 90% of it dedicated to an array of non-gaming attractions that will include rooftop gardens, indoor and outdoor pools, a world-class spa, 34,000 square meters of retail shopping and 36,000 square meters of restaurant and entertainment space. Plans call for an elaborate “East- Meets-West” theme centered around three five-star hotels designed in a grand style reminiscent of the palace of Versailles. There will be 2,000 rooms and suites in all, several hundred of them designed by Versace and Karl Lagerfeld and ensconced in separate towers bearing the names of the two fashion houses. Adjoining the resort is an even larger parcel of land controlled by Executive Director Angela Leong. Conceptually, it means there is considerable room for Lisboa Palace to expand depending on how plans unfold for developing it. Alvin Chau Chairman Suncity Group Macau’s VIP business is in the midst of an unprecedented contraction, and most observers pin the rap on Chinese President Xi Jinping’s anti-corruption campaign. Leading junket promoter Suncity Group Chairman Alvin Chau says junkets share the blame for their current difficulties. Through Chinese language media early this year, Mr Chau said three key factors have conspired in the “end of the dream” for Macau’s VIP business. Forced to work in the shadows, junket promoters granted excessive credit to players. Then they took assets as payment for loans, disrupting the cash flow cycle and leading to liquidity problems, particularly as China’s economic growth slowed and credit contracted. The anti-corruption campaign only amplified the junket’s problems, he suggests, it didn’t create them. Moreover, the changes are here to stay, Mr Chau, appointed to the Guangdong provincial committee of the Chinese People’s Consultative Conference in 2013, says, since fighting corruption and ensuring clean government are essential reforms for China. The solution for junkets lies in bringing their business out of the shadows through better regulation, including stricter licensing requirements, registering guests’ identities and being granted a formal channel for financing. That way, he believes junkets can operate fully within the law and become “good guys.” When Mr Chau talks, people listen. He’s the leading Macau native in the gaming industry. Suncity leads Macau’s shrinking junket market, with an estimated 25% share of rolling chip volume, about HK$88 billion (US$11 billion) per month. Suncity’s volume is down more than 40% from a year ago, scary until you consider that overall junket volume has fallen more than 50%. Bad times have driven many junket promoters to cut back their business and some to exit the sector altogether. Suncity, regarded as prudent with credit, is capturing market share and gaining clout with casinos as competitors struggle. It all began for Suncity with a single VIP room at StarWorld in 2007. The junket promoter now has 156 gaming suites from Macau to Manila to Melbourne that members can book via its Suncity website. The group has led the sector in expanding its array of services for affluent Suncity Club members, Choices now include wealth management from bonds to bullion, immigration consulting, the Sunluxe retail outlet in Macau’s One Central opened last year with exclusive jewelry and watch designs, plus travel arrangements that range from hotel rooms to yacht charters. Suncity Group’s portfolio also includes Sun Entertainment Culture, a producer of recorded music, concerts and features films, plus Sun esse, a modeling agency formed last year. These activities support Suncity’s junket business in practical ways, reserving the best show seats for Suncity customers and giving them a taste of glamour, at least by association. In 2009, Suncity produced the film “Poker King” with an A-list Hong Kong cast, releasing the flick to coincide with the debut of its Poker King Club at Star World. PKC relocated to Venetian Macao last year and remains the top game in town. Showbiz connections also furnish ample opportunities for the fashionable, 41-year-old Mr Chau to provide grist for Chinese media gossip mills. Suncity productions, as well as its sponsorship of events such as the Macau Grand Prix and its e.travellers magazine and UO Macau website, very popular among Chinese visitors, draw tourists to the city for something other than gaming, supporting government