Inside Asian Gaming

13 [Resorts World at Sentosa] as there is a greater focus on ‘getting it right’ for the opening. We believe this is a sensible approach, particularly as both resorts have a different product positioning. When compared to RWS, [MBS] management cite the clear differences in positioning—that MBS is focusing on the MICE [Meetings, Incentives, Conventions and Exhibitions] business while RWS is more targeting the family experience, particularly with the Universal Studios and water-themed attractions. “The RWS site is 3 times larger but has height restrictions of 11 storeys. Both resorts should be complimentary to one another, although both will compete more directly on the gaming side,” suggests CLSA. The casino “The casino will have a similar atrium style to the Sands Macau with two mass market floors and two VIP floors. The street level will be on the second floor; looking up will be the VIP rooms total. Ahead of running our own estimates, we believe this seems reasonable. A quick reminder that in the US it is 50/50 (gaming/non- gaming) and in Macau 90/10 (gaming/non-gaming). “Management expect that gaming revenue could be split more towards VIP than mass with around a 60/40 split. There is space for 1,000 gaming tables but the final number or mix between VIP and mass market has not been disclosed,” continues the report. “With respect to VIP play, management believe it will be less likely that a junket commission war breaks out, as [of the sort seen] in Macau, given the existence of only two players [operators]. We would agree. Also, MBS will be heavily targeting direct high- roller play. While there is scope to attract players that are visiting Macau, the MBS business model has not been created to tap into that market segment. “It seems that the market will be sufficient if tourist arrivals do meet the Singapore Tourism Board objectives of 17 million [arrivals annually] (from 10 million),” says CLSA. “While no official comment has been made, it seems that the junket commission rate will be around 1.25% with scope to pay slightly more to bring in players from further away destinations.” MBS vs RWS [Resorts World at Sentosa] and Macau “Singapore maintains quite an advantage over Macau with respect to infrastructure, particularly in terms of airport capacity and proximity,” says Mr Fischer and his team. “Singapore is expected to be more popular for Indonesians, Thais and Malaysians. Visitors from these markets have different preferences or interests than the typical mainland player in Macau. More often than for players in Macau, it is expected that the partners and families will also join [sic]. “Customer expectations [in Singapore] are considered to be slightly more advanced, with greater demand for luxury shopping and high-end restaurants for Singapore customers versus Macau,” states CLSA. “Indonesians seem to be a potentially very lucrative market for Singapore—the distance is not far; and many wealthy Indonesians maintain private wealth management businesses in Singapore. It is possible that Singapore becomes a more interesting option for those players, who currently visit Crown in Melbourne or Burswood in Perth. “In terms of timing, MBS are not in a race to open before RWS Big bucks - Total cost of casinos built around the world Source: CLSA Asia-Pacific Markets Marina Bay Sands Resorts Singapore Wynn Las Vegas Venetian Macau Encore Las Vegas City of Dreams Venetian Las Vegas Bellagio Wynn Macau MGM Grand Mandalay Bay Paris Las Vegas Sands Betlehem The Mirage Grand Lisboa Luxor Crown Macau Treasure Island Star World New York Monte Carlo Palms Sands Macau 1,000 2,000 3,000 4,000 5,000 (US$m) 6,000 Singapore is a more popular destination for Indonesians, Thais and Malaysians