Las Vegas Sands has reaffirmed its commitment to Macau, as the casino giant announced it plans to spend $1.1 billion on new projects in the city that has become the world’s largest gambling center. The announcement comes at a time when rival operators in Macau are also racing to finish new development in China before casino licenses begin to expire in 2020.
The most significant portion of Sands’ new spending is the planned renovation of the Sands Cotai Central. The company plans to rebrand the resort, turning it into a London-themed complex known as The Londoner by 2020.
The last resort completed by Sands was the Parisian, which opened in 2016. Since then, the company has been focused on renovating their other properties rather than building new casinos.
Las Vegas Sands currently owns five casino-resorts in Macau. Of those, the Sands Cotai Central has reportedly been one of the weakest performers. The company believes one problem could be the facility’s lack of a thematic tourist appeal. Adding a London vibe could help the resort stand next to other Sands properties built around stalwart European cities, such as the Venetian and the Parisian.
According to Sands President and COO Robert Goldstein, the new facility will have plenty of cultural touchstones to draw upon when building its British theme.
“If you think about London, it’s iconic in so many ways, the buses to the Beefeaters,” Goldstein told investors. “Our team is having great fun playing with that.”
The announcement comes at a time when authorities have been trying to get Macau’s casino operators to diversify their holdings and attract visitors with more than just gambling.
Adding non-gaming attractions will help insulate the casinos from drops in gambling revenue, and would be in line with the trend in other casino hubs such as Las Vegas, where non-gaming revenue now outpaces what casinos make on their gaming floors.
Operators may also be starting to consider making themselves look more attractive to authorities before their licenses expire. There are currently six casino licenses in circulation, with those held by SJM Holdings and MGM China set to expire in 2020, and licenses for Sands, Wynn Resorts, and Galaxy Entertainment expiring in 2022.
While revoking a license seems unlikely as the Macau government is heavily dependent on casino tax revenues, a little money spent locally could go a long way toward keeping these revenue generators in the government’s good graces.