Melco Crown Entertainment Ltd.’s billionaire chairman said he wants to be the first resort operator to use Macau as the launchpad for a global hotel brand, beginning with a $1-billion project in the the world’s biggest gambling center with ambitions to expand to Japan and other Asian countries.
Casino tycoon Lawrence Ho plans to debut the company’s first Morpheus hotel, a futuristic high-rise designed by late architect Zaha Hadid, on Macau’s Cotai strip in the first half of 2018, he said in an interview in Macau Tuesday. Ho intends “to build something special in big jurisdictions like Japan or other parts of Asia” to expand the lodging brand aimed at “the most sophisticated international travelers,” he said.
Along with developing a global hotel brand, Melco Crown is mapping a global expansion beyond its Macau flagships with casino projects in Cyprus, Russia and other Asian countries. The company is looking to branch out internationally as the fight for market share against rivals Las Vegas Sands Corp. and Wynn Resorts Ltd. heats up in the former Portuguese colony after a two-year gaming slump.
“It’s a global footprint that we are developing,” said Ho, the 39-year-old chairman and chief executive officer of Melco Crown. “We have done well in Macau and we want to see how we can do even better internationally.”
The expansion plan comes as the casino industry has been rocked by the Chinese government’s detentions in October of 18 employees of Crown Resorts Ltd., which owns a 27 percent stake in US-listed Melco Crown. A group of them were formally arrested last week on alleged gambling crimes. Ho said the arrests haven’t had a direct effect on Melco Crown as it operates independently of Crown, and operators in the Chinese city of Macau could see a boost if the government clamps down on foreign operators luring its citizens to gamble overseas.
Ho earlier this month took on a more direct role at Melco after complaining he was dissatisfied with the performance at the $3.2 billion Hollywood-themed Studio City resort that opened in Macau last year. The resort has “ramped up,” and performed well over the last quarter, Ho said Tuesday, adding that there’s “more potential for Studio City to grow.” The company posted third-quarter profit that topped estimates.
Melco shares fell less than 1 percent to $19.12 Tuesday in New York. While the stock has bounced back from a one-year low in July, it lags behind peers on Bloomberg Intelligence’s index of Macau gaming stocks, which has surged about 45 percent this year.
The company’s overseas growth strategy got a boost earlier this month when its plan to develop a casino resort in the eastern Mediterranean country of Cyprus won government approval. Its first major expansion outside of Macau is the City of Dreams Manila, which opened in the Philippines in early 2015. Ho is also the chairman of a holding company that opened a casino in Russia last year, according to exchange filings.
