Hong Kong needs new facilities as Venetian Macao is set to open a venue for meetings Hong Kong is in urgent need of new exhibition and convention facilities to fend off growing competition from Macau and nearby cities. Its higher value-added convention and exhibition business will face a head-on challenge when more than one million square feet of convention and exhibition area is completed at the Venetian Macao on the Cotai Strip in Macau in the fourth quarter, according to industry participants. Although a big hit from Macau was unlikely in short term, they said the government should consider improving the industry's facilities in preparation for the long-term threat. Michael Li, executive director of the Federation of Hong Kong Hotel Owners, said his group planned to form a strategic alliance with other concerned parties to call for the development of phase three of Hong Kong Convention and Exhibition Centre. In the long term, according to Mr Li, Hong Kong needs new facilities for meetings, incentives, conventions and exhibitions (MICE) as the sector faces intensifying competition from nearby cities. Macau, following the development path of Las Vegas, will make plenty of rooms for exhibitions and conventions. It now has only four convention and exhibition centres with a total gross area of 218,000 square feet, which does not qualify for the hosting of an international trade fair. However, the outlook for the MICE sector in Macau would change after the opening of the exhibition and convention facilities at Venetian Macao. The centre will provide an area of 163,900 sq ft for conventions, 803,900 sq ft for exhibitions plus an arena with 15,000 seats. The exhibition area at Venetian Macao will be larger than the Hong Kong Convention and Exhibition Centre or AsiaWorld-Expo. According to a Jones Lang LaSalle report, at least 44 events have been confirmed to be held at the Venetian Macao in first two years of its operations. The venue will receive an estimated attendance of 327,000 for exhibitions or trade shows in the fourth quarter of the year and 1.3 million for a year. Marcos Chan, associate director of research department at Jones Lang LaSalle, said Macau's new convention and exhibition facilities would bring in overseas business travellers who generally spend more on accommodation and food and beverages than regular tourists. He believes demand and supply for hotel rooms in Macau will rise alongside the influx of business travellers. Stanley Chu, the chairman of Hong Kong Exhibition Organisers Association, also called for more exhibition and convention facilities in Hong Kong, even though he believes the threat from Macau is not imminent. Mr Chu said Las Vegas took more than 20 years to develop into a convention and exhibition destination, and Macau would likewise need time to develop a successful convention and exhibition industry. 'But Macau has an advantage in hosting conventions because it is full of entertainment facilities,' he said. Mr Chu said the Hong Kong government should partner with mainland government bodies and associations to corner international exhibitions in the city. A new exhibition centre in the urban area could also help the development of Hong Kong's exhibition industry. 'The parking area of Hong Kong Convention and Exhibition Centre has to be converted into exhibition area during peak seasons,' said Mr Chu. 'This shows that the supply for exhibition space is tight.' William Cheng Kai-man, chairman of Magnificent Estates, which own hotels in Macau and Hong Kong, believes the outlook for Hong Kong's hotel and exhibition industries remains positive despite the opening of a convention and exhibition centre in Macau. 'Macau does not have an international airport and international flights, which is a problem for the development of its exhibition and convention industry. This definitely gives Hong Kong an advantage in hosting exhibitions,' Mr Cheng said. Last year the Hong Kong Trade Development Council studied the development of the convention and exhibition industry in nearby cities. Its report shows that Macau has strengthened its position in hosting conventions while Guangzhou has increased its capacity for hosting exhibitions with an international convention and exhibition centre in Bazhou. The size of the Guangzhou International Convention and Exhibition Centre will be doubled to more than 3.22 million sq ft by the end of next year. Lawrence Yau, spokesman for Hong Kong Trade Development Council, said: 'Hong Kong does not have enough venues for holding exhibitions. The exhibition area is fully booked in peak seasons.' Under its expansion plans, which started last year, the Hong Kong Convention and Exhibition Centre will have added an exhibition area of 208,821 sq ft by 2009. The Trade Development Council will submit a proposal for the development of phase three of the centre by the end of the year.