Media reports in Macau last week indicated that the government’s Lands and Public Works Bureau (DSSOPT) ill grant only two of the three proposals for land concessions necessary to begin construction. The competitors are Wynn Macau, MGM China and SJM Holdings. Each has submitted the applications and each has claimed that approvals are pending. Apparently not.
The bureau claims that simple logistics make it impossible to approve all three projects. The government, however, has made it clear it desires to stagger construction and opening of new resorts, as is evident from last year’s opening of Galaxy Macau and this year’s debut of Sands China’s Cotai Central project, set for the first quarter. In addition, an annual table game cap of 3 percent could not support the opening of three projects in the same time frame.
With the scarcity of construction labor, the government wants to stagger the openings so the same workers can move from project to project without the need to import more foreign workers for the jobs.
Both Wynn and SJM have announced an agreement with the government, as well as a land premium payment for Wynn, but DSSOPT Director Jaime Carion has not confirmed those deals.
None of the three bidders has a Cotai property yet, so for diversity, the government wants to bring them in. MGM and Wynn have the least amount of gaming space respectively in the Macau market so either of them would see a boost with a Cotai property. But SJM has the home-team advantage, being the only Chinese company bidding. In addition, the SJM concession runs out in 2020, two years earlier than its competitors.