Casino Kings Betting on a Macau Boom
Saturday, March 3, 2007; 9:44 PM
MACAU -- Chinese businessman Cao Yanglin let his lunch of slow-cooked beef rib with truffle puree and lemon cream sauce go cold as he talked about his gambling spree the night before at the baccarat tables in Macau _ the world's new epicenter for gambling.
The 58-year-old property developer said he won $3,840 at the Las Vegas-style Wynn Macau casino hotel, where he was enjoying his noon meal. But he said he lost $7,680 at the new Grand Lisboa, shaped like a giant Faberge egg covered in flashing lights.
The sting of losing so much money seemed to have faded for the smiling Cao, who resembled a TV anchorman with a deep voice, square jaw, dyed black hair and a blue blazer. He was busy musing about the amazing ongoing changes in China and how Macau would profit from the increasingly wealthy Chinese who have a reputation for wagering more than Americans.
"My father was a railroad worker who never left the country," said Cao, from the northern city of Tianjin, near Beijing. "But I've been to Macau more than 10 times and I've even been to Vegas. They need to have more baccarat tables there."
It's gamblers like Cao who helped this tiny city on the southeastern Chinese coast bump off the Las Vegas Strip last year as the world's gambling center. The city raked in $6.95 billion in gambling revenue, while the Strip made $6.69 billion, regulators in both cities said.
Macau _ the only place in China where casinos are legal _ says it's just getting started. More casinos, malls, convention centers, resorts and thousands of hotel rooms are being built in the city _ about one-sixth the size of Washington, D.C.
Those investing billions could be on the dream team of the global casino industry: MGM Mirage Inc., U.S. tycoon Steve Wynn and Las Vegas Sands Corp. head Sheldon Adelson, ranked No. 3 on Forbes' list of the richest Americans.
Also involved is James Packer, executive chairman of Australia's biggest media and gambling company, Publishing & Broadcasting Ltd. And the flamboyant Richard Branson of Britain's Virgin Group Ltd. has been talking about investing in a casino resort.
The tycoons say Macau is a financial no-brainer. They're certain that booming China will continue to get richer and millions of new gamblers will flood into the casinos. The moguls also plan to follow the same blueprint that was wildly successful in transforming Las Vegas from a seedy casino town to a global hot spot for dining, shows, conventions and shopping.
"Macau is the safest bet on Earth," Wynn, who opened his $1.2 billion casino resort here in September, told The Associated Press.
But some analysts are warning there are plenty of risks. China could get hit with political upheaval or an economic meltdown. New gambling resorts in Singapore and other parts of Asia could lure away visitors. Or the shoppers, conventioneers and families just might not show up like they did in Las Vegas.
"I think things could get pretty ugly there pretty fast," said Matt Hoult, a portfolio manager at ABN AMRO Asset Management who is predicting a glut in hotel rooms.