Macau’s Secretary for Transport and Public Works, Raimundo do Rosário (pictured), confirmed on Thursday that the Taipa section of the under-construction light rail transit system would start operation in 2019.
Major building work for the 9.3-kilometre (5.8-mile) Taipa section – which will have 11 stations and serve all the existing and under-construction Cotai casino resorts – would be completed by the end of this year, Mr Rosário said, following a meeting with members of the Legislative Assembly.
Mr Rosário said expenses relating to the Taipa section of the light rail system should not exceed MOP11 billion (US$1.38 billion); with the estimate including fees relating to construction of a depot in Taipa.
The construction of the Taipa section of the rail system has suffered several delays. At one point it was slated to start operating this year, but in December Mr Rosário had indicated to legislators the revised date would be 2019.
The Taipa stretch of the system will also connect the Cotai resorts to Macau International Airport and the new Pac On ferry terminal located near the airport.
A number of investment analysts have expressed concerns that with the Macau gaming market increasingly focusing on mass-market customers, delays regarding public infrastructure projects could be a negative for the new Cotai resorts. Several casino resorts are opening on various dates between this year and the end of 2017.
Japanese brokerage Nomura said in a recent note that attracting foot traffic to the soon to be opened Wynn Palace is likely to be “challenging” until the light rail system is completed.
The US$4.2-billion Wynn Palace, likely to open in the third quarter this year, is being developed by Wynn Macau Ltd. The firm has not yet confirmed an opening date for the property.
In a note on Thursday, Morgan Stanley Research said the construction of a light rail station in front of the entrance of Wynn Palace “could also slow down” the ramp up of the property.
“There is the potential for short-term stock outperformance between now and August 22 (the expected Wynn Palace opening),” said analysts Praveen Choudhary and Alex Poon. “But consensus expectations of 2017 estimate EBITDA [earnings before interest, taxation, depreciation and amortisation] of US$450 million to US$600 million for Wynn Palace may be missed given soft demand,” they added.
No timetable has yet been announced for the start of construction on the Macau peninsula section of the rail link.
On Thursday, Mr Rosário stated the Macau government was in discussion with the mainland authorities regarding a proposed section of the light rail system that would connect Macau to Hengqin Island on the mainland.
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”Assuming that our [Tigre de Cristal] phase two project and the other future operators’ development plans remain on track, we may see the benefits of a ‘cluster’ effect [in the Primorye Integrated Entertainment Zone] as early as 2021”
Summit Ascent, lead developer of Tigre de Cristal