Grand Lisboa Palace could reach break-even in Q2 2022, analysts say

Grand Lisboa Palace partially opened on July 30.
Grand Lisboa Palace partially opened on July 30.

Analysts at JP Morgan Securities predict that SJM’s Grand Lisboa Palace could reach break-even in the second quarter of next year if Macau reopens its borders.

Macau.- Analysts at JP Morgan Securities have predicted that SJM’s new Cotai resort Grand Lisboa Palace could reach break-even during the second quarter of 2022. The forecast comes a day after SJM Holdings reported that the venue saw gross gaming revenue of HKD69m (US$8.9m) in Q3.

JP Morgan’s prediction depends on Macau reopening its borders and easing travel restrictions before then. Mainland China is currently the only country that has a largely quarantine-free travel bubble with Macau. Sanford C. Bernstein believes “Grand Lisboa Palace break-even is still far off,” despite the casino operator’s GGR being better than the market average during the third quarter.

As of September 30, SJM Holdings had invested HKD37.8bn (US$4.86bn) in the development of Grand Lisboa Palace. There was a partial opening on July 30 when the company opened one of the towers with 300 rooms. The remaining hotel venues will open next year.

Analysts at Bernstein stated: “Although management expects these non-gaming offerings will drive more premium mass customers to Grand Lisboa Palace, they admitted the property won’t be at EBITDA break-even until a larger scale of border opening is possible, which may be far off given China’s zero-Covid strategy.”

When complete, Grand Lisboa Palace will have around 2,000 hotel rooms split between three venues: The Lisboa Palace Hotel, Palazzo Versace Macau, and Karl Lagerfeld Hotel luxury boutique hotel. It will have 27,000 square metres of gaming floor space (290,000 sq ft) for up to 700 gaming tables and 1,200 electronic gaming machines.

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