In Macau’s casinos, high rollers come and go, but one man stands above them all
Galaxy Entertainment chairman Lui Che-woo sees grandeur in Macau in the next few years when the Hong Kong-Zhuhai-Macau bridge opens
High rollers come and go, and fortunes are made or destroyed on his tables.
Over it all stands Galaxy Entertainment Group chairman Lui Che-woo, one of Macau’s six gambling licence holders.
The 87-year-old is nonchalant about the crests and troughs that are coming to define Macau’s gambling industry.
Gross gaming revenue – income from gambling as well as hotel stays and entertainment – was 17.77 billion patacas in July, an almost 12 per cent jump from June, as more families choose the former Portuguese enclave as a holiday destination. Together, casinos and hotels presented July with a temporary floor, after 26 consecutive months of declining revenue.
“The clientele has changed from high-stakes gamblers to mass-market gamblers, and now holiday makers spending their weekends in Macau,” he told the South China Morning Post.“Macau is no longer a place just for gambling. It is also a place for playing, for shopping, and for watching a performance to be entertained.”
Standing at the 30th floor of his boardroom at K Wah Centre looking over the eastern Kowloon district across Victoria Harbour, Lui foresees grandeur and glamour for Macau in the next four years.
“Various large-scale infrastructure projects are being undertaken in Macau and in Zhuhai, which will both have a new lease on life in the coming years,” he said.
By 2020, a 50km bridge will link the roads from Hong Kong to Macau to Zhuhai, cutting travel time to 30 minutes. As many as 100 cities and townships on mainland China will be within a three-hour radius from the bridge.
That makes Macau a more attractive destination for holiday makers as well, not just gamblers.
“It will have a tremendous impact on the development of tourism in Macau,” Lui said.
Galaxy, Hong Kong’s second-largest casino operator by value, is scheduled to report its second-quarter financial results on Thursday.
Macau’s six gambling licences are due for renewal between 2020 and 2022. The six current licence holders are Sands China, Galaxy Entertainment, Wynn Macau, SJM Holdings, MGM China Holdings and Melco Crown Entertainment.
“Our most important mission is to support the government’s objective to turn Macau into a global centre of tourism and leisure,” he said.
Macau’s gaming revenue dropped between 10 per cent and 20 per cent every quarter for two years, as a slowing Chinese economy combined with a government crackdown on corruption to deter gamblers.
Lui, who owns 51 per cent of Galaxy, saw his estimated wealth plummet to US$9.1 billion, making him Hong Kong’s sixth-wealthiest man so far this year, from No 2 in 2014, according to Forbes magazine. Two years ago, the Lui family’s wealth was estimated at US$21 billion, behind only that of Hong Kong tycoon Li Ka-shing. Lui owns 61 per cent of property developer K Wah International, with a market value of HK$12.15 billion as at Friday.
“To me, it is only a numbers game. Achieving the goal or task that can help people will bring me greater satisfaction than profit,” Lui said.
Galaxy owns the Galaxy Macau resort, the Broadway Macau with a 3,000-seat Broadway Theatre which featured Britain’s Got Talent dance group Crazy Rouge, and the luxury hotel StarWorld Macau.
Galaxy’s earnings before interest, taxes and amortisation, widely used as a measure of profitability and efficiency, is likely to decline 9 per cent in the second quarter, according to an estimate by Nomura Research.
“Mass revenue only grew 5 per cent year-on-year in the second quarter, trailing the 11 per cent growth in overnight mainland China visitors, highlighting a continuing trend in deteriorating customer spending,” Nomura analyst Richard Huang wrote in a research note on August 15.
Ignoring the market doldrums, Lui proceeded to open a HK$20 billion-plus second phase of his Galaxy Macau resort in Cotai, in May 2015. The group so far has committed HK$43 billion of its planned HK$100 billion investment in Macau.
Phase two of Galaxy Macau and Broadway Macau will have more than 1,500 rooms. Together with phase one of Galaxy Macau and StarWorld Macau, Galaxy owns more than 4,000 rooms spread through seven hotels, including The Ritz-Carlton Macau, JW Marriott Hotel Macau and Banyan Tree Macau.
More than 95 per cent of the total floor area at Galaxy Macau will be devoted to non-gambling amenities, fulfilling Lui’s promise to make the resort a “World Centre of Tourism and Leisure”.
The resort features 200 retail outlets, including international brands such as Louis Vuitton, Dior, Prada, and 120 food and beverage branches at Cotai.
The plans don’t end there. Galaxy plans to add a further one million square metres of space to its current real estate. Phases three and four are in the works, expected to add mass-market and family-oriented entertainment to the properties.
Lui’s eldest son, Francis Lui Yiu-tung, 61, runs the gambling side of the family business, while another four of the Lui children hold a variety of roles within K Wah group, which operates a portfolio of 28 Stanford hotels with 11,000 rooms in Hong Kong and the US.
He is also looking to mainland China, with plans to develop a high-end destination resort on a 2.7 square kilometre land parcel on Hengqin Island in Zhuhai.
Born to a well-to-do family in Jiangmen city in Guangdong province, Lui arrived in Hong Kong at the age of five. His life took an abrupt change when the Japanese army occupied Hong Kong in 1941. He quit secondary school, and took to selling food at the age of 13 on the streets to help support his family, according to a biography.
At 20 years old, Lui started a business trading car parts. In 1955, he founded K Wah to trade in construction material and property. The company was the first to obtain the right to operate a quarry in Hong Kong.
As local industries developed in Hong Kong, and incomes rose, the demand for quality housing grew. K Wah took the opportunity and began building privately owned apartments, beginning with a project in 1962 at Cha Kwo Ling Road. The group later expanded into the hospitality industry during the 1980s.
Lui did not stop here. At the age of 73, he took a huge leap and ventured into Macau’s gambling business in 2002.
His expanding business and subsequent wealth has led to an active life in philanthropy. In July 2014, Lui established the HK$1.3 billion Galaxy Entertainment Group Foundation to provide scholarships to the young, and to helping create employment opportunities in Macau.
Last September, Lui started a HK$60 million award called the Lui Che Woo Prize to recognise “contributions to civilisation”.
Recent laureates, each winning a HK$20 million cash award, include former US president Jimmy Carter, the Medecins Sans Frontieres humanitarian organisation and Chinese scientist Yuan Longping.
“I once told myself that when I became successful one day, I would inspire people to share the fruits of advanced technology, which will bring us a good life, instead of engaging in war,” said Lui. “ I wish to do something to inspire people jointly to build a better world.”