The monopoly of Macau’s gaming industry that lasted 40 years and his role of transforming Macau into the Monaco of the East have bestowed upon Stanley Ho Hung Sun the nickname ‘King of Gambling’. But while the last 15 years may have ‘cooled’ the magnate’s status, his son Lawrence Ho Yau Lung is determined to keep the name of the family at the top of the industry.
In less than one year the 38-year old businessman will be directly responsible for the opening of three casinos accounting for an investment of over US$5.17 billion (MOP41.4 billion). This amount also takes into consideration the share of his partners in the various projects.
The kick-off of this remarkable year for Lawrence Ho began on February 2, with the Grand Opening of City of Dreams Manila. Similar to his projects in Macau, in the Philippines the gaming resort involving Mr. Ho is primarily owned by the joint-venture Melco Crown Entertainment. In this project, Ho, owner of Melco International, has Australian billionaire and owner of Crown Resorts James Packer as a partner.
The project has been recording increasing profit, and in the second quarter of the year City of Dreams Manila generated an adjusted EBITDA [Earnings Before Interest, Taxes, Depreciation and Amortization] of US$12.6 million, up 343.5 per cent quarter-on-quarter from US$2.9 million recorded in the first quarter.
Macau goes from Monaco to ‘Vegas’
In the past, Macau was known as the Monaco of the East but the liberalisation of the gaming sector and new policies of the territory’s government have aligned the region more with Las Vega.
These days, the Special Administrative Region is all about non-gaming and diversification. Based on this new path, the CEO of Melco Crown has announced the October opening of the US$3.2 billion Studio City Macau.
“It [Studio City] also marks a major milestone for Macau as we continue to deliver on our commitment to expanding the non-gaming leisure and entertainment offerings available in the territory, as a continuing strategy in supporting its evolution into a highly diversified and world-leading leisure and tourism destination”, Mr. Ho said on the day of the announcement of the opening date of the integrated resort.
Times may be tough in Macau, with gaming revenues declining for 15 consecutive months – for the first seven months of the year alone, gross gaming revenues declined 36.5 per cent to MOP158.9 billion from MOP250.4 billion – but the Co-chairman and CEO of Melco Crown is confident and recalled that Altira Macau, his first Macau resort, also opened in ‘tough’ times, coinciding with the 2008 financial crisis.
Russian adventure
Of the three gaming venues being opened this year by Stanley Ho’s son, the one raising most questions is the Tigre de Cristal casino in Vladivostok. In the Russian project Lawrence Ho is primarily involved through his controlled company Summit Ascent.
The opening of the first phase of the US$672 million project, sited in one of the four Russian gaming zones (Primorye Region), has already been delayed from 28 August to “late October” although the company has announced that the soft opening of the Tigre de Cristal resorts will take place on 8 October.
This delay was justified by “slower than expected delivery of certain final fit-out materials” and “extensive fire and sprinkler systems inspections by the local government [which] necessitated minor changes to hotel corridor timber and doors”.
Still, according to a filing by Summit Ascent this delay and changes required to the construction did not result in an increase in budget for the first phase, which amounts to US$172 million. The second phase calls for an investment of US$500 million.
City of Dreams’ new tower
While the Melco Crown and Summit Ascent head has been focusing his attention on the new projects, mainly Studio City, which he has visited frequently over the last weeks, he has also devoted attention to developing the existing resorts.
In 2017, Melco Crown is expecting to open the fifth tower of City of Dreams Macau, designed by renowned architect Dame Zaha Hadid. The new tower will have 40 floors, a gross floor area of 150,000 square metres, and will add 780 guestrooms to the property.
In all, 2015 will be a remarkable year for the young Hong Kong billionaire. Last year, he had two properties in Macau operating, Altira Macau and City of Dreams. With these three openings and expansion to the Philippines and Russia he has taken his gaming empire global.
