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Denise Tsang

The Asia chain signed with Venetian for hotels only; Mandarin bets on Las Vegas

Luxury hotel and resort chain Shangri-La Asia has signed agreements to run two hotels at Las Vegas-based Venetian group's hotel-casino complex on Macau's Cotai Strip.

Shangri-La is the first hotelier to win management contracts at the hotel-casino development, with Venetian planning to award more in the coming weeks, a Venetian spokesman said yesterday.

Betting on the fledgling but sizzling tourism and gambling sector in the former Portuguese colony, the group is committed to managing a 500-room Shangri-La hotel and the four-star 1,000-room Traders hotel, slated for opening in 2008.

The contracts, excluding any casino operation, last for 20 years.

'Macau is going to be Asia's Las Vegas, the more brands, the better,' Shangri-La chief executive and managing director Giovanni Angelini said of fierce competition from other upmarket hotels. 'There is a large country next door and they enjoy coming here. The potential is here.'

Occupying a 39-storey building, the Shangri-La projects cost US$500 million, according to Venetian chief operating officer Frank McFadden.

This is part of the group's multi-billion US dollar investment in the strip, a two-phase development to house seven hotels and about 12,000 tourist beds.

The Venetian spokesman said the group would award management contracts for the remaining four hotels and those in the running include Four Seasons, Hilton, InterContinental, Marriott and Starwood and middle-tier player Dorsett of Far East Consortium.

Regal Hotels International Holdings pulled out in September.

Venetian will run its own flagship Venetian Macao hotel at Cotai Strip, a 3,000-suite resort to be ready in 2007 and located opposite the Shangri-La projects.

Mr McFadden played down the intensifying competition for tourist beds, saying that 60 million people annually participated in mainland exhibitions and conventions.

'What we are concerned about is how to satisfy demand rather than creating demand,' he said.

Mandarin Oriental International, which owns and operates the Mandarin Oriental hotel, signed to manage its second hotel project in Macau last month.

The 210-room project, which Mandarin will manage, is part of a retail, residential and hotel complex occupying a gross floor area of 2.6 million sq ft on the waterfront next to the casino-hotel complex MGM Grand Paradise.

The Mandarin hotel is due to open in 2009.

Also in 2009, Mandarin will enter the Las Vegas market by operating a 400-room hotel, the company said yesterday. The hotel is part of MGM Mirage's US$5 billion development that includes 18,000 sq ft of retail shops, a hotel and casino, restaurants, entertainment venues and condominiums.



Shangri-La to manage two hotels on Cotai