While Macau’s infrastructure remains a limiting factor in driving visitation, mass gaming revenues and non-gaming spend, recent projects may see this problem slowly alleviated, says Bernstein.
The brokerage says it recently conducted field research in both Macau and Hengqin, looking at the latest progress in Macau’s infrastructure development.
“The transportation connectivity to Macau is time consuming and often not convenient, while hotel capacity on weekends and holidays has been a key factor in Macau’s dependence on VIP and high end Premium Mass,” noted Bernstein’s analysts in Thursday report.
“Over the next few years, these limiting factors are being alleviated and will help drive visitation and revenues in the industry,” said Bernstein, referencing improved transportation connectivity to Macau through the HK-Zhuhai-Macau Bridge by the end of 2017.
The brokerage also notes Hengqin as a long term driver of growth in Macau, thanks to several projects that will help to bring visitation to the area.
“Hengqin’s development blueprint is highly compatible with Macau as Hengqin may provide the much needed resources to assist Macau’s transformation into a truly Mass destination. The Lotus Bridge, which connects Hengqin and Cotai, will carry a much larger proportion of Chinese visitor arrivals in the future.”
Within Macau, Bernstein also notes the opening of the Pac On Ferry Terminal in Spring 2017 and the Light Rail Transit Phase I in 2019 will also ease traffic and improve connectivity between Cotai casino properties and several immigration entry points.