The good news is that you don’t have to be a gambler to get a free room in some of Macau’s top hotels.
You do have to be a big spender.
And the bad news? The recession is likely to persist this year — and that’s especially ominous for stock punters.
Already, it’s making some casino operators nervous enough to throw money at the problem.
Sands China is pitching a night’s stay free in one of its flagship hotels to anyone who buys at least 20,000 patacas (HK$20,000) worth of goods in its luxury shops.
The “shop and stay” campaign offers a Sheraton deluxe room to big spenders in any two of the 650 shops owned by The Venetian.
If you want a free night at The Venetian, you’d have to spend at least 30,000 patacas, but if you prefer the Four Seasons, it will cost 60,000 patacas in spending.
Note that the Four Seasons sometimes doubles its non-peak rack rates from Sunday to Thursday.
That works out to a 5 percent discount on the required purchases. The rack rate is usually higher than the prevailing selling price at the Shun Tak Terminal.
As I recall, a weekday room rate at Four Seasons Macau fell to HK$1,200 a month ago when rival Galaxy opened the JW Marriott and Ritz Carlton.
That is probably the best rate in the luxury hotel chain.
What intrigues me is how long this hotel promotion will last.
The high rollers are not going to Macau, certainly not this summer which is usually a peak season.
Judging by the summer-long campaign, Macau’s 99 hotel operators are struggling to fill 29,000 rooms.
The occupancy rate was down 7.1 percent in April, according to government figures.
Mainland visitors, who accounted for 63 percent of 827,000 arrivals during April, were down 12 per cent while traffic from Hong Kong (125,000) and Taiwan (29,000) rose 10.9 percent and 8.6 percent, respectively.
That explains why Macau hotel operators are offering hefty advance booking discounts.
Things are not looking good for Macau casino stocks either.
Most are down to one-year lows after Macau’s top economic official, Lionel Leong Vai Tac, said casino revenue will fall another 20 per cent to 16 billion patacas in June.
Only SJM chief executive Ambrose So has predicted the worst will soon be over.
In the meantime, Macau wants people to come and spend big.
Doesn’t anyone worry about the ripple effects of fewer mainland tourists to Hong Kong?
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