Study suggests closure of Macau satellite casinos will negatively impact property values
Realtor Jones Lang LaSalle said the impact would extend to surrounding commercial real estate.
Macau.- Realtor Jones Lang LaSalle (JLL) has predicted that the closure of satellite casinos in Macau by the end of the year will have a negative impact on value of related property and surrounding commercial real estate. It said the effects could continue into early next year.
Mark Wong, senior manager of the agency’s valuation and advisory services, said: “The casino area constitutes about 50 per cent of the total valuation, with rental rates per square foot based on casino revenue. If the satellite venues cannot engage in gambling activities and can only offer other commercial facilities, the rental income per square foot will significantly drop, resulting in a corresponding decrease in property valuation.”
He said that commercial properties valued at HKD80m ($10.1m) to HKD100m ($12.7m) before 2020 had fallen to HKD50m ($6.3m) since the Covid-19 pandemic. Following the implementation of the city’s new gaming law, some satellite casinos already exited the market, causing prices to decline to HKD30m ($3.8m).
On June 10, the government announced that it had received notifications from SJM Resorts, Melco Resorts and Galaxy Entertainment Group that 11 satellite casinos would close by the end of the year. The casinos are: SJM’s Casino Grandview, Casino Legend Palace, Casino Fortuna, Casino Landmark, Casino Ponte 16, Casino Le Royal Arc, Casino Emperor Palace, Casino Kam Pek Paradise and Casino Casa Real; Melco’s Casino Grand Dragon and Galaxy’s Casino Waldo.
According to the government, the three gaming concessionaires have agreed to adequately compensate employees affected and the Labour Affairs Bureau will monitor the situation to ensure that their rights and interests are met. However, some members of Macau’s Legislative Assembly have expressed concerns about the reassignment of around 5,600 workers who may lose their jobs with the closure of satellite casinos in the city. Lawmaker Ella Lei said workers worry there may not be enough jobs and that government must ensure gaming companies with openings prioritise hiring the workers affected.
