The VIP game in Macau is not dead, it’s just been reclassified. According to gaming expert Ben Lee, premium mass has now embodied the same echelon that was so openly panned by the government, and operators are shifting their focus to accommodate.
Headlining the French Macau Chamber of Commerce event on Wednesday, Ben Lee – Managing Partner of IGamiX Management & Consulting – noted that the whales are definitely returning to Macau.
And operators are adjusting.
The recent focus on re-tooling older and smaller hotel rooms into luxury options has swept the SAR, with all operators understanding the need to get quality over quantity.
But this focus on premium mass still creates an impasse. Macau has been long focused on driving footfall to increase revenue. This model, however, flies in the face of its need for more expenditure per person – ergo its revamp.
But mass can’t be ignored, being still the main driver, as Lee points out, indicating exorbitant hotel room prices as a dam for increased visitation – noting that punters will go to other vacation hotspots such as Thailand if the price doesn’t sit well.
And the burgeoning hot spot, Thailand – expected to surpass even Singapore in GGR – is hot on the agenda.
“They expect to pass their gaming law by May of next year. Assuming that takes place, there’s three to five years to build a resort. They could considerably be up and running before Japan opens,” indicates Lee.
The expert predicts that yearly gross gaming revenue of up to $10 billion is not off the table for Thailand once it’s fully ramped up.
And the Asian market doesn’t need to be threatened by other movements worldwide.
The UAE’s venture into gaming might not actually act as a cannibalization of the current market, given its distance and restrictions.
Lee opines that Asian punters will be looking more closely to home and won’t see the UAE as a primary draw, preferring to focus on the upcoming hubs of Thailand and Japan – while milking the current offerings in Macau, Singapore and the Philippines.
But returning to Macau, high-rolling punters will still be subject to strict visa oversight when trying to enter the territory. Chinese authorities have not relaxed their stance in regards to capital outflows, questioning how some whales are able to gamble so much without access to funds back home.
While Macau is cyclical in its crackdown/recovery eras, it will be interesting to see how the upcoming changes play out, and if money can continue to flow as usefully as it did before to the world’s largest gaming hub.
