Inside Asian Gaming

INSIDE ASIAN GAMING | June 2013 4 Inside Asian Gaming is published by Must Read Publications Ltd 5A FIT Center Avenida Comercial de Macau Macau Tel: (853) 8294 6755 For subscription enquiries, please email subs@asgam.com For advertising enquiries, please email ads@asgam.com or call: (853) 6680 9419 www.asgam.com Inside Asian Gaming is an official media partner of: http://www.gamingstandards.com Publisher Kareem Jalal Director João Costeira Varela Editor James Rutherford Operations Manager Muji Vong Contributors John Grochowski, Tom Hall James J. Hodl, Richard Meyer Graphic Designer Brenda Chao Photography Ike, Alice Kok, James Leong, Wong Kei Cheong James Rutherford We crave your feedback. Please email your comments to James@asgam.com EDITORIAL Ho Tram—Finally V ietnam’s gaming landscape is a bit like Las Vegas’, littered with plans for ambitious resorts that never got built for one reason or another. Not to stretch the analogy too far, but in Vietnam as in the Southern Nevada desert most of the flops were cases where developmental reach exceeded financial grasp. The surprise Genting Group sprung on us recently with the announcement of Resorts World Las Vegas gave us an opportunity to examine this in some detail in this month’s issue (see “Vegas on the Come” starting on Page 20). Fortunately for its 2,000 employees, its various stakeholders, for the country of Vietnam and for Asia’s burgeoning tourist population, Ho Tram is not one of these. The money behind this expansive 10-year work in progress appears to be real, and the project has been able to weather some snags, including the loss back in March of its management partner and the better part of its brand identification in the exit of MGM Resorts International, to announce that the first phase of the newly styled The Grand – Ho Tram Strip will open its doors on the last Friday in July. Where it goes from there, of course, is anybody’s guess. The resort is off limits by law to 90 million Vietnamese—9 million of them, the largest aggregation of humanity in the country, living just a couple of hours away in and around Ho Chi Minh City. The problems this poses are obvious. It’s a population with a high propensity to gamble and the means to indulge it. The economic liberalization of the last 25 years has seen per capita income rise tenfold. GDP is humming at growth rates in excess of 6% a year. Lottery and pari-mutuel betting thrive. Tens of thousands of Vietnamese cross into Cambodia every week to patronize the casinos along the border, a phenomenon the government finds disconcerting but has yet to be able to stop, and it was Vietnamese who put NagaWorld in Phnom Penh on the map and who keep it there, contributing an estimated 40% of its annual revenues. Of course, Hanoi isn’t alone in this part of the world in the dim view it takes of gambling by its citizens. Cambodia and Laos have similar prohibitions, and Singapore is doing its level best to discourage it. Investors had hoped new gaming legislation drafted last year would lift the ban or at least modify it, but the government has been adamant, nomatter howmuchmoney you wave at it.“We will pay whatever it takes,”Sheldon Adelson famously said at one point last year, only to be told thanks but no thanks. Genting had big eyes for a $4 billion resort on the South China Sea coast near the popular beaches of Da Nang but decided against it when it realized the ban could not be finessed. Not that Genting is giving up. Relatives of Chairman Lim Kok Thay control one of the country’s biggest slot floors, which is located in a tourist hotel in the northwest bordering China’s Yunnan province, and Mr Thay is keeping his hand in with plans to develop something on a destination scale that also will look to leverage proximity to Vietnam’s giant neighbor. It’s in Quang Ninh province on the northeast coast, an area the government considers ripe for tourism development. But among outside investors the consortium behind Ho Tram, Asian Coast Development (Canada) Ltd, has been almost alone in holding to a realistic view of the opportunities. With the foreign leisure and business traveler in mind they selected a couple of kilometers of gorgeous beach surrounded by forested hills and built a category-killer of a hotel designed to make the most of its surroundings. Ho Tram’s first phase includes 541 five-star rooms and suites, gourmet restaurants, a world-class spa, three swimming pools, high-end retail, convention and meeting space, a heliport and the country’s largest casino, with 90 table games and 500 machine games and exclusive areas for the whales. There is more to come too. A Greg Norman-designed golf course is under construction, and ground was broken last fall on a second hotel. Ho Tram’s location presents challenges its competitors don’t face in the luxury hotels farther north, the Crowne International in Da Nang and the Do Son Hotel and the Royal up in Halong Bay. In other words, it’s farther from China, which, not surprisingly, is the country’s largest source of foreign tourists. But if it can work through this it certainly has the goods to capture an outsized share of a market that currently exceeds 4 million leisure travelers a year. International arrivals to Vietnam were up 14% last year to almost 7 million visitors across all categories. The government expects that to hit 10 million by 2020.