Venetian Macau Construction Cost Blow-out
March 6, 2007
Filed under Business, Casino & Hotels, Construction, Cotai Strip, Las Vegas Sands, Sheldon Adelson, Venetian Macao
We already have mentioned a few times about the lack of quality labor and contractors in Macau. The Venetian Macau are not the only ones, Crown Macau, MGM Grand Macau, Grand Lisboa and Ponte 16 all have massive construction costs overruns. But then again we would imagine that their projected gaming income should be good enough to cover for these overruns!
An American casino giant building a new gaming district in Macau says soaring costs have put up the price of the project up by as much as 40 percent, a media report said Friday.
Sheldon Adelson, billionaire chairman of Las Vegas Sands, which is developing the so-called The Cotai Strip, says the programme could over-run to 14 billion US dollars from the original estimate of 10 billion dollars.
“The demand that we’ve created for construction cranes in this community has so far overwhelmed the capability of the community to handle it that our costs have gone up significantly, along with world prices of steel and cement,” he was quoted as saying in the South China Morning Post newspaper.
“Not to the extent that it makes it uneconomical, not by a long shot, but costs have gone up,” he reportedly added.
The Cotai Strip when completed will boast 20,000 guest rooms across some dozen hotel-casino resorts, including the 3,000-room Venetian Macau, which will be the largest hotel in the world when it opens later this year.
According to the Post report, the strip will employ at least 70,000 people, placing added strain on the tiny city’s already stretched labour market.
Macau is jostling with Las Vegas to be the world’s biggest casino draw. Its 22 casinos already pull in more money per year than the 40-odd casinos on the Vegas Strip — last year the figure was just short of seven billion dollars.
A former Portuguese enclave now governed as a largely autonomous region of China, Macau is the only city in the world’s most populous country that has legalised casinos.
The relaxation of foreign ownership rules that ended a 40-year monopoly on casino control by tycoon Stanley Ho brought a flood of investment from the United States and Hong Kong that has rejuvenated the once moribund sector.
Like Las Vegas, Macau’s casino operators want to tap the lucrative family vacation and convention market by providing all-round entertainment venues, rather than just gambling halls.
Source | Channel News Asia
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