Macau Casino Licenses Issued in 2022 Could Include Hengqin Island Investments
Macau casino operators are set to see their coveted gaming licenses expire in June. Industry analysts at JPMorgan believe the six companies would be smart to include non-gaming investments on nearby Hengqin Island when submitting their applications for fresh concessions.
Macau’s June expiration of the permits that allow Las Vegas Sands, MGM Resorts, Wynn Resorts, Melco Resorts, Galaxy Entertainment, and SJM Resorts to run their casinos continues to cast uncertainty across the industry. Though all six are strong favorites to receive fresh tenders, the companies would certainly prefer to obtain their new operating permits sooner rather than later.
JPMorgan’s DS Kim, Amanda Cheng, and Livy Lyu write in a note this week that the six casino giants will only improve their relicensing odds by announcing Hengqin commitments. Their insight opines that if the casinos voluntarily include “certain budgets for non-gaming projects in Macau and/or Hengqin” they will appease a major 2022 goal of Macau’s government to diversify the economy.
Macau is an isolated Special Administrative Region (SAR) in China, one of only two with Hong Kong. Macau’s relatively small area of less than 45 square miles has hampered non-gaming development in the enclave, as the multibillion-dollar integrated resorts have claimed most of the prime real estate.
Macau, long in search of reducing its economic reliance on casino gambling, believes it has found a solution with neighboring Hengqin Island. Part of Zhuhai and the Guangdong Province, People’s Republic officials in Beijing have encouraged Macau to expand its resort operations to the more vacant Hengqin region.
Gambling is illegal outside of Macau, meaning any investment on Hengqin will be free of slot machines and table games. Traveling between Hengqin and Macau became much easier in August of 2020 when the two sides opened a new border checkpoint across the Lotus Bridge from Macau’s Cotai Strip.
The Hengqin Port checkpoint provides greater connectivity between Macau and Guangdong. With the infrastructure in place, Macau and Hengqin are working collaboratively to lure new businesses to the region.
The Economic Development Bureau of the Guangdong-Macau In-Depth Cooperation Zone held its first in-person networking event this week. The meeting brought together various industries, including biotechnology, medical, artificial intelligence, and computer technology, to discuss the future of the Greater Bay Area.
Macau and Hengqin are striving to foster new industries to boost the SAR’s appropriate economic diversification. With the utmost sincerity, we welcome more and more strategic investors and companies to do business and invest here in the hope of bolstering the industrial development in Macau and Hengqin,” said Li Ziwei, acting director of the Cooperation Zone.
Hengqin Long Considered
Macau’s casino operators — most specifically Sands — have for years mulled expanding their non-gaming resort operations to Hengqin. Sands’ consideration has already spurred other companies into building there.
The Ocean Tourist Resort opened in early 2014. The resort has four hotels with nearly 5,000 rooms and a theme park featuring the world’s largest aquarium. Owner Chimelong International is planning expansion phases to include a museum, marina, and science center.
Macau casino operators could commit to building an array of non-gaming facilities, including additional convention space, hotels, concert venues, theme parks, and shopping destinations.
The post Macau Casino Licenses Issued in 2022 Could Include Hengqin Island Investments appeared first on Casino.org.