The management of Macau casino operator SJM Holdings Ltd says it would look into creating synergies between its gaming resort Grand Lisboa Palace and the adjacent, under-construction Lisboeta Macau, according to notes from two separate brokerages.
That might include the building of a connecting bridge between the two properties, according to comments by SJM Holdings’ management featured in a note from brokerage Sanford C. Bernstein Ltd, issued following the casino operator’s announcement of its third quarter earnings results.
Grand Lisboa Palace (pictured), SJM Holdings’ first property in Cotai, is scheduled to open in 2019, the firm confirmed in a Tuesday filing. The whole resort is to cost approximately HKD36 billion (US$4.59 billion) and is due to open in the second half of next year, shortly before the expiry of SJM Holdings’ current Macau gaming rights in 2020.
Lisboeta Macau was publicly announced earlier this month by Arnaldo Ho Yau Heng, a son of Macau gaming entrepreneur Stanley Ho Hung Sun. The project, with four-star accommodation, has a price tag of HKD5 billion, and is located on land near to the under-construction Grand Lisboa Palace.
The project is being developed by Macau Theme Park and Resort Ltd. Arnaldo Ho and his mother Angela Leong On Kei have been identified as directors of the company. Ms Leong is also an executive director at SJM Holdings and a Macau legislator.
The Sanford Bernstein note said SJM Holdings is likely to speed up construction of the Cotai property in the last months of 2018. “The company expects HKD4.8 billion [to be spent on Grand Lisboa Palace] for the fourth quarter 2018, and the accumulated capital expenditure was HKD25.1 billion at end of third quarter 2018,” said analysts Vitaly Umansky, Eunice Lee and Kelsey Zhu.
According to the brokerage, SJM Holdings’ management said in its comments to analysts that it expected to open Grand Lisboa Palace in the last quarter of 2019.
“The company also said they would open to collaborating with the under-construction Lisboeta [Macau] and were looking to build a bridge between the two properties,” said the Sanford Bernstein team.
The Lisboeta Macau project is due to have 820 rooms and suites, housed in a 12-storey tower with a Y-shaped floor plan, according to the promoter’s presentation. The scheme is flagged as having a possible 2020 opening date.
In a note on Tuesday, analyst Grant Govertsen of Union Gaming Securities Asia Ltd said the brokerage sees Lisboeta Macau’s hotel rooms “as a positive for Grand Lisboa Palace as it can not only provide incremental lodging capacity but target a generally lower-tier customer relative to what is being contemplated for Grand Lisboa Palace.”
Grand Lisboa Palace is a five-star, large-scale property with about 2,000 guest rooms. It will feature a Palazzo Versace hotel and a Karl Lagerfeld Hotel, according to previous information released by SJM Holdings.
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Spending on purchase of goods, commissions paid and customer rebates in Macau's gaming industry in 2018