Inside Asian Gaming

inside asian gaming September 2015 56 Yang Zhihui couldn’t be more plain: “Landing International aims to establish its own branding and presence in the gaming industry,” the Landing chairman and controlling shareholder declares. That’s why Landing bought out Genting Hong Kong in July to take full control of the casino at the Hyatt Regency hotel in Jeju, South Korea’s most popular tourist destination. Separately, Genting Singapore and Landing are partners in the development of the $1.8 billion Resorts World Jeju, which broke ground in February and is expected to open in phases from 2017. It hasn’t been a smooth glide path for Landing and Genting in Korea, but 44-year-old Mr Yang is committed. “We are fully confident in the long-termgrowth of tourism in Jeju, and will seize every opportunity in the market and bring satisfactory return to our shareholders,” he says in Landing’s Hong Kong stock market filing detailing the buyout. Unlike the rest of South Korea, Jeju allows visa-free access for mainland Chinese, attracting 2.9 million Chinese visitors last year, up 58% from 2013. Jeju also offers permanent residency to foreigners who purchase property for KW500 million ($421,000). Mr Yang, who made his fortune as a property developer and investor in central China’s Anhui and Hubei provinces, was smitten with Jeju after a 2002 vacation there. In 2013, Landing won the bid over several Korean chaebols for a 260-hectare (642 acre) development site on the southwest end of the island known as Korea’s Hawaii. Mr Yang backdoor listed Landing on the Hong Kong stock exchange and began looking for a casino partner for the project. Genting Singapore joined in early 2014. Jeju’s largest tourism project, Resorts World Jeju will include 2,000 hotel rooms, a theme park, residences and retail along with a casino. The IR seemed to be in jeopardy last year when Jeju Governor Won Hee-Ryong, elected that June, ordered a review of several large Yang Zhihui Chairman Landing International projects in the autonomous region, including Resorts World Jeju. The property’s groundbreaking was postponed twice. Amid the uncertainty, in November, Landing and Genting Hong Kong each invested $117 million to purchase the foreigners-only casino at Jeju’s Hyatt Regency. It was both a show of good faith to underscore their interest in Jeju and a hedge against the new administration’s reluctance; the casino’s gaming license could be transferred to the IR. The casino was immediately closed for renovation and reopened 18th January as Genting Jeju with 33 tables and 30 machines. A month later, the groundbreaking for Resorts World Jeju took place, with Governor Won in attendance—signifying the government’s endorsement of the project, which is now moving forward. Resorts World Jeju provides the means to fulfil Landing’s ambition of becoming a full-fledged casino operator. Earlier this year, Landing failed to close a $112 million deal for Alpensia casino in Pyeonchang, located at a resort that will be a venue for the 2018 Winter Olympics. So Landing paid back Getting HK’s original $117 million investment to own all of Genting Jeju, which Landing will have to rebrand. The casino has gotten off to good start under new management with reported first half gaming revenue of HK$371.8 million (US$47.9 million), a 16-fold increase over the previous year, and HK$48.9 million in after-tax profits. Genting personnel operating the casino will leave before the end of the year, and we’ll see then whether Mr Yang and Landing keep up their good work. with choice real estate on the popular Gold Coast, including a 296- room Sheraton with potential as a very desirable gaming destination should the state grant more licenses. “We are really confident about tourism in the area,” his son and second-in-command Justin Fung told The Australian Financial Review . “The Gold Coast has a great brand, and my father is very bullish on outbound Chinese tourist numbers.” As well he should be. He’s been investing in Queensland for 16 years. With wealthy Chinese gamblers steering clear of Macau and the scrutiny of a central government bent on stamping out corruption and extravagant spending at home, Australia’s casinos are marketing heavily to lure them Down Under. Queensland is attracting well more than a quarter-million Chinese tourists a year and expects they will generate one-third of a forecasted $30 billion in total overnight visitor expenditures by 2020. These, in a nutshell, are the economics underpinning Aquis Great Barrier Reef Resort, and Mr Fung is looking now to transform Canberra into its staging ground. He’s listed the operation on the Australian Stock Exchange as Aquis Entertainment. He’s recruited gaming industry veteran Geoff Anders from Sands Macao as CEO and commissioned a renowned group of architects and designers comprised of the Friedmutter Group, Westar and Australia’s DBI to submit master plans for an integrated gaming and nightlife complex on a Las Vegas scale.