SJM Holdings concerned at cost overruns

    SJM Holdings Chief Executive Ambrose So Shu-fai said he is concerned the company’s Lisboa Palace project in Cotai may be delayed and go over budget because of higher salary and material costs, The Hong Kong Standard reports.

    The company, which vies with Sands China for top market share in Macau, began work on the Lisboa Palace earlier this year. The project will comprise of a full range of non-gaming facilities occupying more than 90 percent of the total area, including around 2,000 hotel rooms housed in The Lisboa Palace Hotel (over 1,450 rooms), Palazzo Versace Macau (up to 270 rooms), and another fashion-branded luxury hotel (also up to 270 rooms). 

    The casino will have 700 gaming tables and over 1,200 slot machines across a gaming floor area of approximately 27,000 square metres. The total production cost is estimated at about HKD$30 billion ($3.8 billion).  

    So gave no further details about costs after SJM’s annual meeting. Rising prices are seen as one potential risk factor facing the territory’s booming casino industry given the shortage of local labour and restrictions on imported staff.  

    SJM managing director and Ho’s fourth wife Angela Leong On-ki said talks are on with the government about renting sites in Cotai South.

    So also predicted that gross gambling revenue in Macau will rise 10 percent in 2014 to $50 billion despite weaker-than-expected growth in May that sent casino share prices reeling.