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Lai Sun Group unit eSun Holdings and its American partners put the price tag on their planned hotel-casino-retail-TV studio complex in Macau at US$2 billion (HK$15.6 billion) assuming their request to almost double its floor space wins government approval.

Lai Sun Group unit eSun Holdings and its American partners put the price tag on their planned hotel-casino-retail-TV studio complex in Macau at US$2 billion (HK$15.6 billion) assuming their request to almost double its floor space wins government approval.

eSun executive director Ambrose Cheung Wing-sum estimated construction will cost up to HK$9.36 billion, or HK$1,500 per square foot. The 1.52 million-square-foot site in the Cotai reclamation area is valued at about HK$4.68 billion.

eSun and its US partners will each contribute HK$780 million as working capital. eSun said additional funds for the project could come from international capital markets or an initial public stock offering.

The partners hope to increase the size of the project to 6.6 million sqft, up from the 3.66 million sqft in the existing approved building plan.

eSun, which produces films and television shows, is to receive HK$1.32 billion from selling a 40 percent stake of the Cotai project to its partners, US- based hedge fund Silver Point Capital and former Las Vegas Sands executive David Friedman. The payment could rise to HK$2.97 billion depending on whether the expansion plan is approved and other conditions.

The project will feature two five-star hotels and hotel apartments along with a television/film studio, a concert hall, convention and exhibition facilities and a retail complex.

The deal gives the US partners the option of leasing 200,000 to 500,000 sqft for gaming or other entertainment at minimum rent of US$25 million a year. Friedman said the casino will have about 300 tables. Analyst Karen Tang of Deutsche Bank said the partners are in talks with existing Macau gaming operators.

Friedman said sections of the project will begin opening in early 2009 and be fully complete by early 2011.

Silver Point, which has about US$5 billion under management, focuses primarily on distressed debt. Until December, Friedman headed up the US$1.8 billion Cosmopolitan mixed-use project, similar to the Cotai venture, in Las Vegas.

Shares of eSun fell 10.4 percent Monday to HK$6 after initially surging to a 52-week high of HK$7.30 when morning trading began. Shares of eSun parent Lai Sun Development, which owns the Ritz Carlton Hong Kong and other hotels, jumped 7.8 percent to 41.5 HK cents after it said it expects to book a gain of HK$440.6 million from the Cotai deal.
 

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The Turbulant History of Macau Studio City

Six years ago, they were going to build a film school on that piece of land in Cotai. Now, they’re getting ready create a casino with a difference there. And maybe even a Playboy Club, too.

Macao Studio City, a HK$16 billion(US$2.05 billion) synergy-saturated gaming, entertainment, retail and resort development is slated to open in early 2009 on the Cotai Strip. It’s a project that’s changed “script” and “cast” as often as a Hong Kong soap opera, and it promises more drama over the next two to four years as well.

During take one in January 2001, the project was known as the “Star Beauty Corridor” and consisted of 150,000 square metres of land with HK$300 million(US$38.5 million) of investment, according to Portuguese-language media in Macau.

asia-tv-city-2.jpg
Acquired by East Satellite TV (a wholly-owned subsidiary of Hong Kong entertainment titan eSun Holdings Ltd., listed as “LSD” on the Hong Kong Stock Exchange), the planned property featured a cinema studio, film school and an audio visual center. In October 2001, it was granted a 25-year concession. The project was at that time expected to be completed 2003; it never materialized. What happened?

According to Macao Studio City Co-Chief Executive Officer and eSun Holdings Ltd. Executive Director Ambrose Cheung, changes to Macau’s gaming laws altered the project substantially. Cheung, comments: “the original idea was for a studio theme with a tourism emphasis.” But, he explains, “With the liberalisation of gaming we had to adjust our strategies and concepts. The market was changing rapidly, and that’s why we talked to the Macau government again and asked the land use to be expanded to include commerce and hotels.”

Land of the rising eSun
By 2004, take two was already rolling. It began with a call for more land; 340,000 square metres of gross floor space, or roughly 87 percent of Cotai lots G-300, G-310, G-400, prime real-estate right between the new Venetian and the Lotus Bridge Checkpoint leading to Zhuhai’s Hengqing Island. East Asia and eSun wanted the remaining 13 percent of the site to be in “tentative” use for the public. Of course, they needed to procure the proper licenses. They went into negotiations with their sister-company Lai Fung Holdings Ltd.

On November 15, 2004 East Asia and Lai Fung Holdings signed a Memorandum of Cooperation to build a TV/Film studio, concert hall, convention and exhibition centre, two four- to five-star hotels and an all-suite hotel. Public releases don’t specifically mention that eSun were applying for a gaming license for the site at this time.

The deal was: Lai Fung paid East Asia HK$ 46 million and expected two conditions to be met in return. First, Lai Fung expected the licenses or approval from the Land, Public Works and Transport Bureau of the Macau SAR for the design of the work of the Project. What were the details of the “Project?” According to eSun documents, the “Project” was specified as 30 residential attached houses with a total site area of 20,000 square meters.

Secondly, Lai Fung, referred to in eSun company records as the “Proposed Partner,” was promised “participation rights,” which allowed them to contribute to and share 40 percent of the production costs and profits. The deadline for East Asia to get the proper chop? No later than June 2005.

By May 30, 2005, East Asia received “conditional approval” from Macau authorities to go ahead with their plan. They also said yes to a retail complex.
Overall, 340,000 square meters of gross floor space were given the yellow-light; the change to green pending final approval from Macau authorities. It appears that this deal was the mold that would later crystalise into Phase One of the current Macao Studio City project.

Of course, the deal was about to experience turbulence. East Asia and Lai Fung Holdings needed to negotiate an extension of the formal approval deadline to December 2005. Santa didn’t bring the license. Despite efforts to extend the deal in late December and February, they terminated their agreement on March 31, 2006, with East Asia returning the HK$46 million back to Lai Fung Holdings.

Meanwhile, another partner entered the picture - American real estate and retail giant Taubman Centers.

Joining Private Friedman
The project’s third take was underway The April 2005 opening of the Taubman Asia office in Hong Kong created significant attention from the Asian real-estate community.

Taubman’s reputation for highly productive projects and attractive investment returns, and its experience in casino retail development in Las Vegas and Atlantic City caught e-Sun’s eye. Taubman Asia President Morgan Parker explains, “They approached us in September 2005, and we were immediately attracted to the opportunity of developing a retail center at Cotai in Macau.”

Parker also notes that, “When we learned that David Friedman and the New Cotai consortium were joining the team we were delighted. The New Cotai people were well aware of our reputation in the United States and I think were happy that eSun was in discussions with us.”

Who are David Friedman and the New Cotai interests?
Take four. On April 21, 2006 eSun issued a circular detailing a deal with a new entity known as New Cotai LLC, a Delaware listed company. New Cotai consists of US private funds management firms Silver Point Capital and Oaktree Capital Management, and a star already well known in Macau, former Las Vegas Sands executive David Friedman.
In return for HK$1.32 billion, New Cotai was to receive a 40 percent stake in the project.

By this point, the project had two publicized phases. Phase One Development included the design, construction, implementation and operation of the Cotai Site’s hotels, hotel apartments, retail, entertainment facilities, production studios, concert halls, theatres, and other tourist and entertainment related facilities. The gross floor plan for was 3,659,769, square feet. Phase Two Development, on paper, revealed an expansion of between 5,573,830 to 600,000 square feet.

Take five took place on the morning of Friday, June 16, 2006, inside the relaxed, chandelier-laden and pastel blue-painted walls of the Hong Kong’s Ritz-Carlton’s Harbour Room, which eSun’s parent company, the Lai Sun Development group, also runs. All parties gave a nod to the transaction laid out in the circular, then moved forward to more ink in August.

Undressing for the press
Take six took place in front of a slew of reporters. It was the overcast afternoon of January 10, 2007 on the 1.5 million-square foot lot of Cotai property itself. It was announced that the resort would have a 200,000-square foot casino to be operated by Melco-PBL Entertainment. Moreover, Singapore-listed developer CapitaLand announced plans to buy a 20 percent stake in Macao Studio City. Their tab? An initial HK$659 million that will fatten to HK$1.1 billion if the project is a success.

On the hotel front, Shanghai Tang founder David Tang will be constructing a new 150-room boutique hotel. Tang is also an independent director of eSun’s parent company, Lai Sun Development, according to the Financial Times. Another 2,000 hotel rooms will be divvied up between the Ritz-Carlton, Marriott and another private hotel, yet to announced. This is just for Phase One, scheduled to open in early 2009. Phase Two (rumored to involve tennis courts and possibly a golf course to support the hotels and expand on the western part of the property) will open in 2011.

Who else is onboard?
Macau Business magazine has discovered that there is a planned Playboy Club (see Macau Daily Blog, October 6, 2006) slated to be part of Phase One as well. [See Story; Macau Playboy Club Exposed]. Executives with Macao Studio City and Playboy Enterprises Inc. declined to officially comment on any details on plans for a Playboy Club.

In terms of design, Las Vegas casino designer Paul Steelman has created an innovative complex for Macao Studio City that mixes cinema, retail and hospitality. At the center of the complex, Parker says, “will be the heart of the casino,” with retail and TV studios pulsing all around it. The interior of the two level retail interior will be honeycombed with TV-screens, sloping halls, and recording studios.

The shopping arcade part of the project will have one million square feet for the first phase and additional 400,000 square feet for the second. There will also be a massive theater for films and concerts, many from eSun’s portfolio of Hong Kong pop-stars. Hong Kong’s movie and pop-star might will be to Macau what Hollywood’s flash is for Vegas. “The synergy is amazing,” Parker adds.

However, designer James Wong of Paul Steelman Design in Macau says approval for construction has yet to be given by Macau authorities. They’re anticipating approval by the end of February, when they’ are likely to start the pile-driving. And - action!

Playboy Club exposed
The official announcement of a Playboy Club opening at the new Macao Studio City project on the Cotai Strip might come as early as March, inside sources tell Macau Business. At the moment, it’s being kept under wraps.

“We can’t say anything publicly now, but we’re very excited that they’re coming,” comments one member of MSC team who declines to be named. MSC executives Ambrose Cheng and David Friedman politely declined to comment. Playboy spokesperson Linda Mariscano told Macau Business, “Playboy has publicly stated its interest in Macau but has nothing to announce at this time.”

Nevertheless, Playboy Enterprises Executive Vice President Richard S. Rosenweig is talking about Playboy’s popularity in China. Rosenweig, who is in charge of the Playboy Mansion in Los Angeles, told Macau Business that, “We have been in China for a very long with our clothing brands, as one of the most top brands there, depending on which polls you read.”

“I’d love to come to China,” he adds. No doubt. Playboy has retail and entertainment operations throughout Greater China, from Playboy ties in Shanghai to Playboy TV in Taiwan and Hong Kong. Playboy opened a boutique in Hong Kong early last year.
On the club front, they’ve been trying to get into China for years. In December 2004, Playboy Club Shanghai Chairman and CEO Michael Nussbaum announced that Playboy was on the brink of opening a seven-storey VIP Club in Shanghai. The next day the central government killed the plan - Nussbaum had spoken prematurely before everything was approved.

After the Shanghai club plan’s demise, eyes shifted to Macau. At the October 2006 opening of the Palm’s Fantasy Tower Playboy Club in Las Vegas, Playboy CEO Christie Hefner told reporters that Macau and London were possible future club sites - because they, like Vegas, can smoothly blend gaming and nightlife. In this sense, the new clubs will harken back to the swinging sixties and seventies, before Playboy clubs closed out in the 1980s.

According to several sources, the club planned for Macao Studio City will feature gaming and operate as a joint venture. It’s currently planned to be located on the southern part of the property. Plans also include entrances on the first and second floors. The project is “definitely” part of phase one at this point, which means that it is likely to open in early 2009.

More might be learned about the project in mid-February, during Playboy Enterprises’ fourth quarterly earnings public conference call (Playboy Enterprises is publicly listed on the New York Stock Exchange as PLA). Mariscano said the conference will take place on February 13, but the exact day and time had yet to be confirmed at press time. The conference can be heard by phone or online, and public transcripts of the conversation between Christie Hefner and analysts are usually posted on the Internet.
Lucas Binder is one such analyst who will ask Hefner about the Macau Playboy Club during the conference call.

Binder, a director at UBS in New York, told Macau Business, “Yeah, I’m very interested to know.” Binder continues, “If they were to open, they would probably do so through licensing and there would be no overhead, like at the Palms. They would have to have a definitive time-line for completion, too.” Fishing for facts, Binder asked Macau Business for more news about Playboy’s Macau opening, “So, when am I coming to Macau, 2007 or 2008?” Try after the Olympics.

source
 

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Mich.-based developer Taubman unveils luxury shopping center in Chinese gambling city Macau
27 August 2008

HONG KONG (AP) - Michigan-based mall developer Taubman Centers Inc. unveiled its foray into the booming gambling city of Macau on Wednesday -- a giant upscale shopping center aimed at capitalizing on China's growing appetite for luxury goods.

The 920,000-square-foot (85,000 square meter) Mall at Studio City will boast about 140 stores from Gucci, Cartier, Burberry, Dolce & Gabbana, Prada and other brands in one of the biggest concentrations of high-end retailers outside New York and Paris, the company says.

Scheduled to open in 2011, the center is the showpiece of a $2.5 billion joint venture gambling resort project along the city's Cotai Strip.

Macau, the only place in China where casinos are legal, surpassed the Las Vegas Strip as the world's top gambling center in 2006. Now Tuabman and others are betting that the tiny former Portuguese colony, like Vegas, will become a shopping mecca.

Their sights are set largely on Chinese consumers. Already accounting for 18 percent of global luxury sales, Chinese are likely to exceed Americans and Europeans as the largest revenue group in just six years, said Morgan Parker, president of Taubman Asia Limited.

"Macau is the fastest growing retail market in Asia," Parker told reporters Wednesday. "Together with Hong Kong, Macau represents the very best access portal into China's growing appetite for luxury."

Others agree. Wynn Resorts Ltd. and Las Vegas Sands Corp. have set up major retail centers at the Wynn Macau and Venetian Macao in the last couple years. A Four Seasons' center opened last month sports many of the same tony brandnames.

What separates Taubman's project, Parker says, are scope and scale: dozens of flagship luxury stores offering a wider selection of merchandise in one central location.

He dismisses any worries about a retail glut, saying 40 million tourists were expected to pass through Macau by 2010. And whereas Vegas -- among the world's most successful shopping destinations -- has about 350 feet of retail space for each hotel room, Macau will have about 150 in the next couple years, he says.

"We're only really touching the tip of the iceberg," he said.

Founded in 1950, Taubman in the U.S. owns or managers 24 shopping centers in 11 states. The company calculates its market capitalization at $7 billion. Taubman is based in Bloomfield Hills, Mich.
 

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Sure

He dismisses any worries about a retail glut, saying 40 million tourists were expected to pass through Macau by 2010. And whereas Vegas -- among the world's most successful shopping destinations -- has about 350 feet of retail space for each hotel room, Macau will have about 150 in the next couple years, he says.
Yeah right, out of which a few thousand are not tourists brought in by the truckload on "free tours" from mainland to spend a few RMB on cheap/fake souvenirs. Exactly like Vegas!!!
 

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No news

You are ressurecting a dead post for a dead project. Check the website, latest news are 2008.
I guess the project died and investors should be suing one another by now...
 

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