Sept. 4, 2006
A Vegas-size Bet on China
By STEVE FRIESS
Casino mogul Steve Wynn has just come from his
daily two-hour Chinese lesson. In addition to learning the basics,
he says he's studying phrases he might need for his new venture:
"Welcome to our hotel" and "I hope this is the beginning of
a long friendship."
A long and profitable friendship, that is. The
man who invented the Las Vegas megaresort will open the first
one next week on the southern Chinese peninsula of Macau. As
usual, Wynn's leading the pack: Las Vegas gaming companies plan
to invest about $20 billion in the province by 2010. This spring,
the Las Vegas Sands Corp. will open the $2.3 billion Venetian
Macau, with a façade three times the size of the Vegas version,
to complement the Sands Macao, a casino-only property that opened
in 2004.
By the end of 2007, Wynn's resort (the $1.2 billion
Wynn Macau, which NEWSWEEK has toured exclusively) will be neighbors
with the $1.1 billion MGM Grand Macau. Macau's potential customer
base is staggering. Las Vegas is within a five-hour flight for
450 million people; Macau, a former Portuguese colony returned
to China in 1999, is the same distance for 3 billion. The existing
casinos—dark and cramped, but still successful—attract day-trippers
who take hydrofoil rides from Hong Kong.
But Sands chairman Sheldon Adelson says China's
growing middle class and the middle classes of Hong Kong, Japan
and South Korea represent a pool of travelers interested in
fancy hotels with shows, convention space, fine dining and high-end
shopping. "We could build 10 Las Vegas Strips over here, there's
so much demand," he says. Between the Wynn, Sands and MGM projects,
and the easing of travel restrictions in some parts of China,
Wall Street analysts predict Macau's gambling take could exceed
the Las Vegas Strip's next year.
The Americans have put uniquely Asian twists
on the Las Vegas esthetic. Slot players win if they line up
lucky eights, not sevens, per local superstitions. Instead of
craps tables, which hold little appeal, baccarat dominates.
There's no buffet at the Wynn; the one at the Sands Macao is
a healthy affair far removed from the fried-food frenzies in
Las Vegas. Still, from the outside, the Wynn Macau mirrors the
Wynn Las Vegas.
The room furnishings are the same, too. He's even
reimagined the dancing fountains at the Bellagio (which he sold
in 2000). Wynn and his competitors hope Macau becomes a breeding
ground for "whales," gamblers who bet as much as $1 million
per session. (A disproportionate number of whales at Las Vegas
casinos fly in from Asia.)
The Wynn Macau will serve as a local base for
Las Vegas-style luxury and, he hopes, encourage trips to the
gambling mecca. "Las Vegas represents unlimited choice," says
Wynn, "and there won't be that critical mass in Macau" right
away. So that's why he's asked his Chinese instructor to teach
him another valuable phrase: "I hope one day you will visit
us in Las Vegas."
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