by Steve Norton
CEO, Norton Management

Influx of tourists fail to lift Singapore’s casino market in 2016

Singapore should not be concerned by the reduction in customer spending in the two casinos, as long as the visitor numbers keep climbing, and revenues are spent elsewhere. In 1990, I was President/COO of the LV Sands, owned by Sheldon Adelson; the year we opened the Sands Expo Center, and Las Vegas passed Chicago as the Convention capital of North America. We hosted the largest trade show, the computer industry's Comdex (with 170,000 attendees and exhibitors), also owned by an Adelson company; and used all of the convention and exhibit space of the LV Convention Center, Caesars Palace, Bally, the LV Hilton and the Sands Expo Center. Since then, the LV Strip has learned that earnings can come from the rooms, food, beverage, and convention departments, and exceed those of the casino. Casino win has dropped from the 70 percent to 80 percent range of total revenue to only 35 percent; but the non casino departments provided 73 percent of the departmental profits, atf the 23 largest casino resorts (year end 6/30/16).

Wisely, Singapore selected Sheldon and his Marina Bay Sands, to build a destination resort with exceptional convention and retail space, allowing the City State, with 35,000 existing accommodations, to become an Asian leader of the MICE industry, (Meetings, Incentive, Conventions and Exhibitions).

And the only other license, for an all inclusive family destination resort, was won by Genting; in a close battle with 8th Wonder Asia, a company that I was a Director of Singapore was originally opposed to the idea of casino gaming; but came up with a plan to allow only two, multi $billion projects; and they have allowed Singapore visitor counts to grow from just over 9.5 million in 2010, when the casino opened, to 16.4 million visitors last, year; an increase of nearly 70 percent in less than 7 years.

With the growth of new casino jurisdictions; Asian developers would be wise to take a close look at Singapore, and determine which departments can also add meaningful profits to the total development. And understand that Singapore has one of Asia's top International Airports, an Island wide light rail system, now nearly 40,000 quality hotel accommodations and a local population of nearly 5 million affluent Asians.