Macao casino relicensing occurring as region recovers from shutodown of properties
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Macao's government wants to build theme parks, theme hotels, water parks and other family attractions as a condition of relicensing. The government also wants casino companies to develop nearby Hengqin Island. New law bumps the gaming tax up from 39 percent to 40 percent. There is a tax break for attracting foreign visitors to the area. The Chinese central government will have a seat at the table on all strategic plans. It will also have an eye on any potential changes on the horizon. Las Vegas Sands Corp., Wynn Resorts Ltd. and MGM Resort International are confident they will be successful in the relicensed process.
The government wants to increase international tourism, develop MICE, hold major sporting events, promote art and culture, create themed amusements and develop maritime tourism. Las Vegas companies have already invested in Macao. The government defines technology-related innovation and tourism as technology and business development. The three Las Las companies already have built several nongaming attractions in the area. They did not respond to requests about how much they’ve already spent. It is estimated to be in tens of billions of dollars. Macau is on the seacoast.
Macao's economy is struggling due to the COVID policy and relicensing process. Many of the customer-facing workers are Filipino. Some middle managers from Australia, New Zealand and the United States went home. Companies operating in the market are reluctant to talk about the license renewal process because they don't want to appear critical of China. Sands, Wynn and MGM executives said in their second-quarter earnings calls that they expect Macao to recover. Hornbuckle said Macau's push for sports and entertainment falls into his company's wheelhouse. Hubert Wang, president and chief operating officer of MGM China, also said the company’s experience in attracting international guests to its casinos will play in its favor.
