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Singapore IRs bet on S$9b expansion; exclusive licences extended to 2030
SINGAPORE'S two integrated resorts (IRs) are set to invest S$9 billion in expansion, with the exclusivity period for both casinos being extended past the original 2017 expiry date to end-2030 instead.
The committed investments - which will include a 1,000 room all-suite tower at Marina Bay Sands (MBS), a 15,000-seat arena and extensions to Universal Studios Singapore - are for non-gaming facilities, although both IRs will also receive additional gaming provisions.
Subject to payment of land costs, Marina Bay Sands (MBS) has the option of an additional 2,000 sq m of Approved Gaming Area, and Resorts World Sentosa (RWS), another 500 sq m. But their gambling revenue will be further taxed by the Government. To rein in problem gambling, casino levies on Singapore residents will be increased. The daily levy will go up from S$100 to S$150 from Thursday, while the annual levy is being increased from S$2,000 to S$3,000.
The S$9 billion boost, expected to directly create up to 5,000 new jobs, was announced on Wednesday evening by the IRs and the Ministries of Trade and Industry; Finance; Home Affairs; and Social and Family Development. The new investment by the IRs is about two-thirds of their initial S$15 billion investment in 2006. The extension of the exclusivity period, during which there will be no new casinos, was provided "in view of the substantial investment and to provide business certainty", said the ministries.
The IRs plan to invest S$4.5 billion each. MBS will build a fourth tower next to the existing three, on some eight acres of current state land that will have to be purchased at market price. Designed by the same architect, Moshe Safdie, it will also be topped by a sky roof and include a luxury all-site hotel with some 1,000 rooms. The tower's centrepiece will be a 15,000-seat arena focused on entertainment. This will fill the market gap between the 55,000-seat National Stadium and the 12,000-seat Singapore Indoor Stadium, and help attract more A-listers to perform here, said MBS chief executive officer George Tanasijevich.
The tower will also have additional MICE (meetings, incentives, conventions and exhibitions) space, for an increase of about 30 to 40 per cent.
The new facilities are expected to create 1,500 to 1,800 new jobs, with two-thirds likely to go to locals. MBS said it could not share a timeline for completion as yet.
RWS's expansion, comprising multiple attractions, will add some 50 per cent or 164,000 sq m of gross floor area. This will be largely through intensification of existing land, with the original plot ratio of 0.7 being increased to 1.0.
Some 2,800 new jobs are expected to be directly created. New experiences will open each year starting from 2020, with full completion anticipated around 2025.
These include two new areas at Universal Studios Singapore: a Minion Park based on the popular yellow characters from the Despicable Me franchise, and Super Nintendo World, with attractions based on the console games such as Super Mario.
The SEA Aquarium will be expanded to about three times its current size, taking over the existing Maritime Experiential Museum space to create the Singapore Oceanarium.
The waterfront promenade will be redeveloped with dining options, two new hotels providing about 1,100 rooms, and a 37m-tall public attraction with free evening light shows.
The first attraction to open, likely by end-2020, will be an "adventure dining playhouse".
Replacing the Resorts World Theatre, the pirate-themed experience will combine immersive dining and performance.
MICE facilities will also be expanded. And a new driverless transport system will shuttle visitors along the Sentosa Boardwalk in about 1.5 minutes, with an estimated capacity of nine million passengers a year.
The IRs' plans are part of a broader tourism push, including the development of the Greater Southern Waterfront - of which Sentosa is a part - as well as Mandai ecotourism and the rejuvenation of Orchard Road.
Maybank Kim Eng economist Chua Hak Bin noted that the move "comes at a time when more countries are duplicating Singapore's successful integrated resort model, including the Philippines and Japan".
"Expansion of the IRs will also help create jobs, revive the construction sector and support the property market, particularly hospitality," he added. "The boost to the economy won't be as large as the mid-2000 boom, but will still be sizeable."
CIMB Private Banking economist Song Seng Wun sees the moves as important so that the IRs stay "relevant and fresh", but expects them to support incremental growth in tourist arrivals, rather than resulting in a spike.
The rejuvenation is important to attract both new and repeat visitors, he added.
"Singapore isn't the cheapest place to visit, so planners must look for new ideas to make more people want to come."