OCTOBER 2017 FORBES ASIA | 19BILLY H.C. KWOK/BLOOMBERG
FORBES ASIA
GAMBLINGLawrence Ho’s Wager
Macau mogul is convinced that a huge Japanese bet will pay off.
B
illionaire Macau casino mag-
nate Lawrence Ho declares
Japan’s nascent gaming indus-
try to be “the most exciting
market,” as the world’s biggest
operators prepare to table their bids for a
lucrative license. This follows his pledge
in Tokyo earlier this year “to spend what
it takes” to win a stake in a sector that
was provisionally legalized only last year
and stands to give the country a take
rivaling that of Las Vegas.
Speaking to Forbes Asia on the side-
lines of this year’s Forbes Global CEO Con-
ference in Hong Kong, Ho—the CEO and
chairman of Melco Resorts & Entertain-
ment—said his company’s philosophy “is al-
ways to deliver the coolest, the most innova-
tive, the highest-quality resorts. I think that
blends very well with the philosophy that
the Japanese market has.”
While the law to legalize casino gam-
bling has been passed, it still awaits further
legislation outlining precisely how the in-
dustry will be regulated—and the locations
of the casinos. But the casinos will be part
of “integrated resorts” that include other at-
tractions and facilities in a bid to enhance
tourism.
Ho said the company favored locating
close to Japan’s biggest cities—such as Yo-
kohama and Osaka. “Everywhere we build
integrated resorts, our mantra is always to
build the coolest thing. And Japan will eas-
ily be the coolest; we’ll experiment with the
latest in technology, latest in building meth-
ods, latest in engineering. But in order to do
that, we really have to pick a location that is
top-tier—near major cities with a huge pop-
ulation and also high potential for tourists.”
He appeared to rule out the capital as
a possible destination, however. “We don’t
think Tokyo is going to happen. It’s such a
fantastic city, but it’s a city for government,
for financial. It’s less casual when you goto Tokyo. I think the government is think-
ing of using the integrated resorts as urban
revitalization, so I think they’re looking at
Yokohama.”
While Japan is very much a gamble on
the future, Ho spoke glowingly about the
performance of one destination: Macau.
Asia’s preeminent gaming hub—and the
only Chinese territory where gambling is
legal—experienced a slump in gaming rev-
enue in recent years amid a well-publicized
anticorruption drive by the Chinese gov-
ernment that, among other things, reduced
the amount of time mainland Chinese visi-
tors could spend in Macau. But now the pic-
ture looks brighter ahead of “Golden Week,”
a weeklong holiday that China implement-
ed in 2000 to boost tourism.
“So far, this year has surprised us—very
pleasantly—in terms of how strong the mar-
ket has come back,” Ho said. “Macau went
through two very tough years. We made
use of those two years to focus on efficiency
and lean downs, as part of our continuous-
improvement philosophy. Now I think this
Golden Week is going to be phenomenal. Sofar, year to date, the market is up 19% and
really across all segments [of the casino in-
dustry], so the high-end segment, the mass-
market segment ... and the average stay is
also increasing.”
However, one thriving gaming destina-
tion in Asia that may cause concern for op-
erators like Melco is the Philippines, after a
presidential order to sell government casi-
nos owned by the Philippine Amusement
and Gaming Corporation (PAGCOR) as
soon as next year. Asked whether he was
concerned about the casino business being
cannibalized there, Ho was unmoved. “I
think the Philippines has been the star with-
in our business for the past two years. I al-
ways like to compliment my team down
there, where we have the fastest-growing
property in the fastest-growing market in
the world. It’s working out extremely well.”
He pointed out that more internation-
al tourists are visiting the country, as per-
ceptions about it change. “I think in the next
few years, there will be more and more tour-
ists going in, so that will be the next phase or
catalyst in terms of the business.”F“Our mantra is always to build the coolest thing. And Japan will easily be the coolest.”BY PAUL ARMSTRONG