Too Many Hotel Rooms in Macau?
Written on November 10, 2006 by Macau
As I cannot comment on Las Vegas properties, I still think that the US casino operators are taking a huge risk with their Macau properties. Reports that Las Vegas Sands and Wynn Resorts are expecting about plus 90% occupancy for their rooms is a little bit far fetched.
The reason for this is simple, let’s just take The Lisboa which has traditionally only has an average occupancy of 80-85% and who knows how many of those rooms are being used by the high rollers for free.
The fact remains that about 90% of the visitors are daytrippers, it is well known that some of them gamble right through the night.
At current daily arrival rates of about 60,000 visitors that leaves about 6,000 possible hotel room occupants. I am not even discounting for the vistors that may stay with relatives or have their own apartments.
Currently Macau has about 11,500 rooms with at least 20,000 more rooms to come on stream in the next five years, although mainly on the Cotai Strip! Unless they do some wonders with exhibitions and trying to create some attractions I can not foresee how they will get those 90% plus occupancy rates.
Lets put it this way, even if they can increase overnight stayers to say 20,000 rooms in the next five years, that will still leave 35% of the rooms vacant. And not everyone will stay 5-star plus.
Maybe SJM is going the right direction, Dr Stanley Ho is still staying on the Macau Peninsula and is planning to build a Casino Hotel to cater for the European market. Maybe there is a clue here!
See the full story here: casino-and-hotel-aimed-at-high-brow-tourists
Contrary to what people are saying I strongly believe that SJM will still hold his market share and Dr Stanley Ho is slowly fighting back. He just hired Frank McFadden away from Venetian Macau!
Things are happening!
Please don’t forget your comments.
Cheers,
Bert
Technorati Tags: cotai, Cotai Strip, macau, Stanley Ho
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