eSun and Silver Point Capital to develop a $2 B hotel-casino-retail-TV studio project on Cotai Strip in Macau
Written on June 19, 2006 by admin
The Standard | Lai Sun Group unit eSun Holdings and its American partners put the price tag on their planned hotel-casino-retail-TV studio complex in Macau at US$2 billion (HK$15.6 billion) assuming their request to almost double its floor space wins government approval. eSun executive director Ambrose Cheung Wing-sum estimated construction will cost up to HK$9.36 billion, or HK$1,500 per square foot. The 1.52 million-square-foot site in the Cotai reclamation area is valued at about HK$4.68 billion.
eSun and its US partners will each contribute HK$780 million as working capital. eSun said additional funds for the project could come from international capital markets or an initial public stock offering. The partners hope to increase the size of the project to 6.6 million sq. ft., up from the 3.66 million sq. ft. in the existing approved building plan.
eSun, which produces films and television shows, is to receive HK$1.32 billion from selling a 50 percent stake of the Cotai project to its partners, US- based hedge fund Silver Point Capital and former Las Vegas Sands executive David Friedman. The payment could rise to HK$2.97 billion depending on whether the expansion plan is approved and other conditions.
The project will feature two five-star hotels and hotel apartments along with a television and film studio, a concert hall, convention and exhibition facilities and a retail complex. The deal gives the US partners the option of leasing 200,000 to 500,000 sq. ft. for gaming or other entertainment at minimum rent of US$25 million a year. Friedman said the casino will have about 300 tables.
Analyst Karen Tang of Deutsche Bank said the partners are in talks with existing Macau gaming operators.
Friedman said sections of the project will begin opening in early 2009 and be fully complete by early 2011.
Silver Point, which has about US$5 billion under management, focuses primarily on distressed debt. Until December, Friedman headed up the US$1.8 billion Cosmopolitan mixed-use project, similar to the Cotai venture, in Las Vegas.
Technorati Tags: cotai, Cotai Strip, Entertainment, macau, Macau Gaming
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