Macau boasts and will continue to hold an “impregnable” advantage over its regional competition when it comes to the sheer scale and quality of its supply, particularly given the rising cost of entry for jurisdictions looking to enter the market, according to Sands China’s CEO and Executive Director Grant Chum.
Chum delivered the Keynote Address at G2E Asia on Tuesday, where he reflected on the opening of the Cotai Strip’s first integrated resort, The Venetian Macao, in 2007 and the massive development since that has seen the area become by far the world’s largest land-based gaming hub.
And while the likes of the Philippines, Japan and Thailand have either built their own IR industry or hinted at plans to do so, Chum said it would remain extremely difficult for anyone to challenge Macau’s expansive tourism offering.
“[Macau] is an unparalleled, unmatched, critical mass of first-class resorts in every sense,” he explained.
“For jurisdictions looking to liberalize, cities are looking to add one or two of these amazing integrated resorts with all of the diversity within the same building, but Macau, on Cotai has 10 or 11 world class integrated resorts.
“It is almost impossible to imagine that over the next one decade, two decades, three decades, there could be another city in the region that could rival this critical mass of premium integrated resorts.
“The cost of entry is going higher and higher. The cost to build is forever escalating. When you think about Cotai, collectively, what’s been invested here – US$40 billion to US$50 billion – that’s the cost that the operators built at the time. So, what’s the actual replacement cost of these 11 resorts today, or next year, or in five years’ time?
“We built [The Venetian Macao], one of the largest buildings in the world at the time, for US$2.4 billion and it would probably cost US$11 or US$12 billion to recreate now.
“So Macau has an impregnable advantage on the supply side. No other city, certainly in Asia, could match this unparalleled, incredible mass of premium integrated resources, all in one place and so easily accessible in a wonderfully stable environment that is fun, but also very safe for visitors.”
Chum also praised the success of Macau’s diversification push, pointing specifically to three key sectors that have played a critical role on the city’s growth: entertainment, retail and MICE.
On the recent focus on entertainment, to which Sands China has played a significant role via high-profile concerts like Jacky Cheung and global sporting brands like the NBA China games, Chum noted that Macau’s “event economy is truly thriving” – providing “continued enhancement to [Macau’s] global reputation.”
Macau, he added, is “blessed with the enduring advantages of political stability, latent demand and unmatched tourism supply that is guided by quality and quality. Tourism-related diversification is a critical part of the progress of the last two decades. We’ve seen the growth of the MICE industry, the growth of the entertainment industry, the growth of the retail industry, but increasingly, sports, wellness, art and culture, all of these things will continue to flourish.
“We at Sands are unrelenting optimists on Macau’s future and will do our utmost to advance Macau’s diversification and to advance Macau’s reputation internationally as a unique and compelling tourism destination.”
