Inside Asian Gaming

INSIDE ASIAN GAMING APR 2019 22 COVER STORY CLUSTER EFFECT By that time, Summit Ascent expects that Hong Kong listed NagaCorp and Russia’s Diamond Fortune will have opened their Primorsky casinos. Shambala, which ran a casino in the Azov gaming region that was eliminated at the end of last year, also announced plans last June for a Primorsky casino. “We don’t see the other operators as competitors,” Tsifetakis says. “We see them as opportunities for a cluster effect.” Innovation Group Director Michael Vanaskie examines the potential cluster effect in Primorsky in a recent monograph, using Macau and Manila’s Entertainment City as spectacularly successful examples. He notes that the proposed scale of investment in Primorsky, US$2.7 billion, is well below the US$23 billion in Macau during the first decade of casino liberalization and roughly half of the US$5 billion in Entertainment City. He sees another key obstacle to a successful cluster in the Integrated Entertainment Zone (IEZ). “I think the biggest challenge is the fact that there is not a strong existing foreign tourism base in Primorye,” Vanaskie writes, using a common informal term for Primorsky, in response to questions from IAG. “This doesn’t mean that Primorye can’t succeed as a gaming destination, but to become a top gaming destination within the region the IEZ will have to induce a large number of foreign visitors. “From what we’ve seen in the past, to accomplish this, the IRs within Primorye would have to be truly visionary properties (along with necessary infrastructure improvements). If the investment into IRs and non-gaming destinationswithin the IEZ does hit theUS$2.7 billion target by 2025, it could certainly become a gaming destination. However, we don’t see it becoming a top destination – it will be difficult to a create a truly visionary property at that investment scale across multiple developments.” Being a regional gaming destination neighboring China, Korea and Japan would likely suit Primorsky and its backers just fine. Tigre de Cristal’s Presidential Suite Russia requires that all foreign currency purchases and sales take place at banks, so the casino floor has a bank branch operating 24/7.