Coming up aces!

Macau bets on diversification of source markets and product offerings, Michael Taylor writes

 

 

Two large hotels have thrown open their doors in recent months as Macau seeks to diminish its overwhelming reliance on gambling, which currently accounts for roughly half of the former Portuguese enclave’s GDP, and its overwhelming reliance on Greater China, which accounts for the lion’s share of tourism arrivals.

The Wynn Palace opened in late August, and the Parisian Macao opened in mid-September.

 

Together, the two new properties have added 4,706 rooms and suites to the already crowded mix.

With the opening of the Parisian, Sands China alone now has seven hotels with a total of 13,000 rooms as well as 150,000 square metres of meeting space, 150 F&B outlets, and 850 retail outlets along the Cotai Strip.

Four more new hotels are on the way.

 

The 13 will have 200 rooms, the MGM Cotai will have 1,600 rooms, the Fifth Hotel Tower will have 780 rooms, and the Lisboa Palace will be even larger than the Grand Lisboa, with 2,000 rooms in three towers.

All four properties will open before the end on 2017.

 

More than hotels will be opening. The long-anticipated Hong Kong – Zhuhai – Macau Bridge will open mid-year.

Considering that the number of tourists visiting Macau fell by 811,004 or 2.6 per cnet in 2015, can the enclave realistically absorb so many additional hotel rooms?

While filling rooms will be a challenge, it is hoped they will make Macau a more attractive destination for organisers of meetings and events.

According to Daniella Tonetto, general manager, sales and marketing, Sheraton Grand Macao Hotel, Cotai Central, and The St. Regis Macao, Cotai Central, the additional rooms and facilities will allow Sands Macao to handle larger scale MICE activities with as many as 15,000 people under one roof, as the seven hotels are interlinked. Shuttle buses are needed to move participants from one venue to another.

Time to re-position

Speaking recently before the Legislative Assembly, Macau Chief Executive Fernando Chui Sai-on called on the city’s six casino operators to expand their focus toward attracting more conventional tourists and recreational gamblers in addition to the high rollers that have traditionally been their target market.

“Macau’s gaming industry and the whole economy will continue to adjust,the decline may shrink to 7.2 per cent this year,” the chief executive told the assembly.

 

“It’s a good time for Macau to re-position [itself] after a 25-month gaming revenue drop.”

Greater China accounts for approximately 85 per cent of stays at the Sheraton and the St. Regis, with about 70 per cent of guests coming from China, 10 per cent from Hong Kong, and 5 per cent from Taiwan.

“These three markets require very different things,” Tonetto says. “Visitors from Hong Kong, Taiwan and Southern China have very high expectations.”

In order to diversify markets and encourage guests to stay longer, more focus needs to be put on entertainment and the big name acts that often perform at the 15,000 seat Cotai Arena, which draws concert-goers from throughout the region.

“We need more integrated resorts with attractions that make people want to stay longer or return,” Tonetto says.

World centre of tourism and leisure

Hoteliers have responded positively to a Macau Government Tourism Office (MGTO) initiative to turn Macau into a “world centre of tourism and leisure”.

“Guests will stay longer in any destination if and when there are more activities to experience and enjoy,” says Rutger Verschuren, general manager, Grand Lapa, Macau.

 

“Activities in Macau are related not only to gaming, but even more, are geared to couples and families to visit cultural heritage sites, see shows and museums, dine and shop, enjoy nature and beach walks, see an old fisherman’s village, and so on.”

All of these attractions are within 30 square kilometres. Verschuren believes hotels should not leave it only to the government to promote these attractions and activities. The hotels themselves should promote them on social media to encourage visitors to stay an extra night.

According to Grant Bowie, CEO and executive director of MGM China Holdings, the opening of new hotels – including the MGM Cotai – will be a significant step forward in Macau’s aim to become a world centre of tourism and leisure.

“This would mean additional innovative and tailored offerings dedicated to increase the length of stay of the visitors and to attract wider markets,” Bowie says.