Inside Asian Gaming

inside asian gaming JUly 2015 20 Cover Story Still, interest in creating gaming resorts in Vietnam grows. In May, Banyan Tree’s Laguna Kang Co resort issued a Request for Concepts for companies to develop and operate a gaming complex on its property north of Danang in central Vietnam’s Hue province. That’s not one of the areas the government has designated for casino development, but the owners reportedly think they can squeeze out a license anyway. Down the coast in Quang Nam province, top Macau junket operator Suncity Group and Chow Tai Fook Enterprises joined investment firm VinaCapital in March to revive the Hoi An South IR project first announced in 2010. “The reported investment by Chow Tai Fook and Suncity Group shows the exciting potential of Vietnam as an integrated resort destination,” Colin Pine, general director of the local subsidiary of Asian Coast Development Ltd, developer of the Ho Tram Strip IR area to the south, says. Vietnam’s leadership might add that the investment commitment shows the wisdom of careful IR family planning. Local officials indicate that Chow Tai Fook, headed by Hong Kong billionaire Cheng Yu-tung, has taken a majority stake in the project, exceeding the reported 20% share of VinaCapital’s original partner, Malaysia’s Genting Group, which pulled out in 2012. The reinvigorated project’s first phase will cost $500 million, including a hotel and golf course along with a casino that earlier reports indicated would include 90 gaming tables, to open in late 2018 or early 2019. Hoi An South is at least the third prospective Asia-Pacific casino project for Chow Tai Fook. It’s a partner with Echo Entertainment bidding for a new casino in Brisbane and has signed a letter of intent for a $1.6 billion resort in South Korea’s developing Incheon IR cluster, another foreigners-only casino market. “Chow Tai Fook is trying to secure good locations in markets that allow gaming, even if they are foreigners-only,” Global Market Advisors Partner Andrew Klebanow observes. “Their goal is to build attractive resorts that offer an alternative to Macau and to demonstrate to the [host] government that they are willing to invest sizable amounts of capital into the region.” Suncity cites multiple reasons for its interest in the Quang Nam project and in Vietnam. “It is the goal of Suncity group to diversify from being a gaming promoter to a casino operator with its own licensed casino and also to venture into non-gaming business, whether it is locally or overseas,” Suncity’s Marketing Strategy Department President YM Choong says. “Currently Suncity Group sees that it is the right timing and opportunity to invest in this country which is geographically an ideal location,” within three hours flight of key source markets. The project includes residential components that could enhance returns, he adds. Quang Nam hosts a pair of UNESCO World Heritage sites, Hoi An’s Old Town dating to the 16tth century and My Son, the largest cluster of ancient Cham structures well over 1,000 years old. The resort site, in the Chu Lai Open Economic Zone, is some 70 kilometers (42 miles) south of those attractions and about 100km from the closest international airport at Danang, more than two hours by road. “Ultimately, it is airlift that will determine how big the area’s gaming and resort market will be,” Mr Klebanow says. The Suncity, which has an estimated 30% share of Macau’s junket market, has been expanding its range of travel services and destinations for customers, including a greater presence in Manila, and previously expressed interest in building a resort in Phu Quoc, an island off Vietnam’s southwestern tip. Phu Quoc Ho Tram’s $600 million first phase includes a 541-room Paul Steelman- designed beachfront tower, world class links golf course The Bluffs designed by Greg Norman and casino with 90 tables and 600 EGM positions.