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<TABLE border=0 cellSpacing=0 cellPadding=0 width=452><TBODY><TR><TD vAlign=top width=452 colSpan=2>Published June 2, 2009
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>US$2.1b City of Dreams opens in gloomy climate
Project seen to be garnering US$1.4b in gross gaming revenues in 2010
By ARTHUR SIM
IN MACAU
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MELCO Crown Entertainment has opened the US$2.1 billion City of Dreams in Macau, possibly the biggest integrated entertainment resort to open in the world so far this year. And the world will be watching to see if it will be able to draw the crowds in these tough times.
<TABLE class=picBoxL cellSpacing=2 width=100 align=left><TBODY><TR><TD>
</TD></TR><TR class=caption><TD>Striking a happy note: Officials including Mr Ho (right) and Mr Packer (centre) smashing guitars during the opening ceremony of the City of Dreams yesterday </TD></TR></TBODY></TABLE>Asked why it went ahead with construction while its neighbours such as Las Vegas Sands and eSun Holdings/CapitaLand decided to put their Macau projects on hold, CEO Lawrence Ho said cryptically that Melco Crown is 'not near bankruptcy'.
Melco Crown already has a relatively successful casino hotel in Macau, the Altira Macau, formerly the Crown Macau. It surprised stalwarts by attracting a sizeable share of the lucrative VIP/high-roller market after a shaky start when it opened in 2007. At the time, three other rival casino hotels opened together with the Altira. With the opening of City of Dreams today, it has the spotlight all to itself.
More critically, Mr Ho said that Melco Crown had arranged all its financing for the new development before the onslaught of the global credit crunch. He revealed that Melco Crown, which is listed on the Nasdaq Global Select Market, has a debt/equity ratio of 1:1.
Referring to the many stalled developments in Macau, Mr Ho added: 'As you can see if you look around, developments on this scale do not happen on their own. It is easy to start but much harder to finish.'
Still, City of Dreams will be opening in phases.
The first phase includes mainly the 420,000-square-foot casino, the 292-room Crown Towers hotel, the 330-room Hard Rock Hotel Macau, and the 85,000-sq-ft retail mall called The Boulevard. The 800-room Grand Hyatt and a 2,000-seat theatre will open in the next phase.
Macau has had to deal with a double whammy of the global economic downturn and perhaps more severe, visa restrictions imposed by the Chinese government on travel to the SAR by Chinese nationals.
Visitor numbers were down 3.5 per cent in April from the same period last year but visitors from mainland China were down 13.5 per cent year on year.
However, things may be looking up with the fall in gaming revenues thought by some to have bottomed.
Some also believe City of Dreams will be able to capture market share from existing players by offering a different product. Unlike Altira, it will also target the mass market and younger gamers with its 'lifestyle' offering, the Hard Rock Hotel and Casino. Mr Ho added: 'Rather than go to a Venice or Egypt themed resort, people can now come here.'
Speaking to The Australian earlier, Janet Brashear, senior gaming analyst with US investment house Sanford C Bernstein, said she expects City of Dreams to 'make a splash, garnering US$1.4 billion in gross gaming revenues in 2010 and a 10 per cent share of the market'.
Greg Hawkins, president of City of Dreams, declined to give revenue projections but he did note the Venetian next door does see about 50,000 to 70,000 visitors per day. 'We expect City of Dreams to do the same,' he added.
Melco Crown is a joint venture between James Packer and Mr Ho, the scions of iconic businessmen Kerry Packer and Stanley Ho respectively.
</TD></TR></TBODY></TABLE>
</TD></TR><TR><TD vAlign=top width=452 colSpan=2>US$2.1b City of Dreams opens in gloomy climate
Project seen to be garnering US$1.4b in gross gaming revenues in 2010
By ARTHUR SIM
IN MACAU
<TABLE class=storyLinks border=0 cellSpacing=4 cellPadding=1 width=136 align=right><TBODY><TR class=font10><TD width=20 align=right>
</TD><TD>Email this article</TD></TR><TR class=font10><TD width=20 align=right></TD><TD>Print article </TD></TR><TR class=font10><TD width=20 align=right></TD><TD>Feedback</TD></TR></TBODY></TABLE>MELCO Crown Entertainment has opened the US$2.1 billion City of Dreams in Macau, possibly the biggest integrated entertainment resort to open in the world so far this year. And the world will be watching to see if it will be able to draw the crowds in these tough times.
<TABLE class=picBoxL cellSpacing=2 width=100 align=left><TBODY><TR><TD>
</TD></TR><TR class=caption><TD>Striking a happy note: Officials including Mr Ho (right) and Mr Packer (centre) smashing guitars during the opening ceremony of the City of Dreams yesterday </TD></TR></TBODY></TABLE>Asked why it went ahead with construction while its neighbours such as Las Vegas Sands and eSun Holdings/CapitaLand decided to put their Macau projects on hold, CEO Lawrence Ho said cryptically that Melco Crown is 'not near bankruptcy'.Melco Crown already has a relatively successful casino hotel in Macau, the Altira Macau, formerly the Crown Macau. It surprised stalwarts by attracting a sizeable share of the lucrative VIP/high-roller market after a shaky start when it opened in 2007. At the time, three other rival casino hotels opened together with the Altira. With the opening of City of Dreams today, it has the spotlight all to itself.
More critically, Mr Ho said that Melco Crown had arranged all its financing for the new development before the onslaught of the global credit crunch. He revealed that Melco Crown, which is listed on the Nasdaq Global Select Market, has a debt/equity ratio of 1:1.
Referring to the many stalled developments in Macau, Mr Ho added: 'As you can see if you look around, developments on this scale do not happen on their own. It is easy to start but much harder to finish.'
Still, City of Dreams will be opening in phases.
The first phase includes mainly the 420,000-square-foot casino, the 292-room Crown Towers hotel, the 330-room Hard Rock Hotel Macau, and the 85,000-sq-ft retail mall called The Boulevard. The 800-room Grand Hyatt and a 2,000-seat theatre will open in the next phase.
Macau has had to deal with a double whammy of the global economic downturn and perhaps more severe, visa restrictions imposed by the Chinese government on travel to the SAR by Chinese nationals.
Visitor numbers were down 3.5 per cent in April from the same period last year but visitors from mainland China were down 13.5 per cent year on year.
However, things may be looking up with the fall in gaming revenues thought by some to have bottomed.
Some also believe City of Dreams will be able to capture market share from existing players by offering a different product. Unlike Altira, it will also target the mass market and younger gamers with its 'lifestyle' offering, the Hard Rock Hotel and Casino. Mr Ho added: 'Rather than go to a Venice or Egypt themed resort, people can now come here.'
Speaking to The Australian earlier, Janet Brashear, senior gaming analyst with US investment house Sanford C Bernstein, said she expects City of Dreams to 'make a splash, garnering US$1.4 billion in gross gaming revenues in 2010 and a 10 per cent share of the market'.
Greg Hawkins, president of City of Dreams, declined to give revenue projections but he did note the Venetian next door does see about 50,000 to 70,000 visitors per day. 'We expect City of Dreams to do the same,' he added.
Melco Crown is a joint venture between James Packer and Mr Ho, the scions of iconic businessmen Kerry Packer and Stanley Ho respectively.
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