Major renovation works at Sheraton Grand Macao are now underway while a revamp of the second casino at The Londoner Macao will begin in May, according to Sands China, with the company warning it faces significant disruption to its product offering throughout 2024.
The update formed part of parent company Las Vegas Sands’ 1Q24 earnings call on Thursday morning (Asia time), with Sands China reporting a slight decline in revenue and Adjusted Property EBITDA when compared with the December 2023 quarter.
In particular, The Londoner Macao saw net revenues fall from US$589 million to US$562 million, with the company noting that its hotel room count was down by up to 600 rooms as a result of the renovation works.
The US$1 billion Phase 2 renovation of The Londoner Macao, which is on top of the US$2 billion already spent under Phase 1, includes the Sheraton, with Sands confirming the hotel’s first tower will be complete by the end of this year and its second by May 2025.
Renovations of the second casino at Londoner are also scheduled for completion by December.
“When we’re done, [Londoner] is going to be one of our best properties in Macau,” said LVS President and COO, Patrick Dumont.
“The design will be high level, the layout of the casino will be very good, the additional food beverage amenities that we will add and the connectivity will be a very good driver of future results for that property.
“We’re pretty confident that the results when it’s done be equal to or better than The Venetian Macao.
“But we’re doing it now and it is going to be disruptive. The worst is going to be across the summer when we have the lowest key count that we’ve had since we really opened [Londoner’s precursor] Sands Cotai Central.
“We’re taking the Sheraton out so it’s going to be more of this disruption across the summer but then hopefully as keys come back online across the phasing and as we get [Cotai Arena] back in October or November we’ll have a much more powerful set of assets to drive tourism and create cash flow.”
On the upgrade works going on at Venetian’s Cotai Arena, which also closed its doors in January, Sands China CEO and President Grant Chum said, “Cotai Arena has always been a core part of our content offering. We were able to offer plenty of shows at The Londoner Arena [in Q1] but it doesn’t compare to the sheer number of shows that we had in the first quarter – we had 12 shows in Q1 compared with 31 shows in the fourth quarter last year. It’s a big difference.
“Hopefully that gives some color in terms of the disruption that has had on our business because of the arena being closed for renovation. Our hotel renovation is ongoing and you will see more keys out of our inventory in the next couple of quarters.”
Asked about the decision to take Cotai Arena offline at the same time as renovation works were ramping up at The Londoner Macao, Dumont said the company opted to accelerate its capex projects to ensure a smooth runway from mid-2025 onwards.
“We made a decision that if we take the arena offline and do it and make it one of the highest quality arenas in Asia, in the long run we will benefit from the entertainment, so we decided to do it as quickly as possible,” he explained.
“Once we do that we’re going to have an incredibly high quality arena with amenities that we never had before.
“It will make us more competitive in the market and actually drive additional high-quality tourism from both traditional markets and other markets. It will also help provide high quality tourism from our core customer base and allow for more repeat visits from our high value customers.
“We’re very excited about the opportunity doing entertainment presents to us but unfortunately we’re going to take some pain while it’s offline and that really started in January this year.”
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