Stanley Ho’s Sociedade de Jogos de Macau (SJM) is rising to the new competition in the gaming sector, unveiling one incredible project after the other, like the Grand Lisboa above.

WHEN STANLEY HO and his holding company Sociedade de Turismo e Diversões de Macau (STDM) were awarded the sole gaming concession in Macau back in 1962, he said that the company would bring a new prosperity to the region, and improve the welfare and living standard of its citizens.

True to his word, STDM, and its gaming subsidiary, Sociedade de Jogos de Macau (SJM), have spent more than 40 years modernizing what was a depressed fishing community. Plowing investment and social contributions into the peninsula and its islands, it has been providing 70% of the government’s total revenues through direct taxes. Although STDM’s monopoly ended in 2002, Stanley Ho’s empire continues to dominate the gaming market, and hence provided the majority of last year’s $1.8 billion tax revenue for the government of Macau Special Administrative Region (MSAR).

“Macau is a modern city today because of STDM,” says Ambrose So, Director of SJM. “Over the past 40 years, apart from the taxes it has paid, the company has undertaken a number of infrastructure projects that went way beyond what was required in the concession agreement. Macau International Airport, the bridges, the urbanization and resettling of people in the outer harbor – STDM has had a hand in all of these, and much more. It is a local company, rooted in Macau, and it has a passion for the region’s growth.” Proud of its roots, Stanley Ho’s SJM is making great efforts in the development of cultural tourism with projects including Ponte 16 in the inner harbor, Macau Fisherman’s Wharf in the outer harbor, and the East-West Cultural Village in the historical Rua da Felicidade district. Dr. So adds, “Through the efforts of the government, Macau has another novel name: ‘City of Culture.’ If you come to Macau you will see that the culture has a long history, longer than Hong Kong, and the buildings are more carefully preserved. I think we can make use of the cultural uniqueness of Macau to explore cultural tourism, and of course conventions and resorts, which can be a major attraction for tourists.”

AMBROSE SO Director of Sociedade de Jogos de Macau

Competition from the liberalization of the sector doesn’t seem to have daunted Stanley Ho in the least. To the contrary, it seems to have brought out the best in him, and in May of this year he announced his most ambitious project to date – the $800 million (6.2 billion Macanese patacas) Oceanus, designed by internationally acclaimed French architect Paul Andreu. One of Macau’s largest hotel, commercial, residential, shopping and entertainment complexes yet, Oceanus will project out into the harbor next to the Macau-Hong Kong ferry terminal and rise from 164 feet inland to 436 feet (50 meters to 133 meters) at the waterfront, symbolically representing a sea change for Macau. “This project further strengthens our commitment to the development of Macau, and once again proves our confidence in its future,” Stanley Ho stated when the project was announced. “We believe that the Oceanus complex will help develop Macau into the region’s tourism, entertainment and leisure center.” A separate 600-foot tower will be among Macau’s tallest buildings and in fact will be near another of his current projects: the 44-story Grand Lisboa hotel-casino, which is scheduled for a 2006 completion, and is being touted as Asia’s most luxurious hotel.

Alan Ho, executive director of Florinda Hotels International, another STDM subsidiary that manages several of the group’s hotels in Macau, including its flagship Hotel Lisboa, says that the trend for hotel rooms is that they are progressively larger. “Although you can decorate a room quite luxuriously,” he says, “it’s difficult to change its size, so new hotels will be catering to new expectations.”

Building on the past and shaping the future, SJM has strengthened its roots and premier position in Macau.

Increased competition in the sector hasn’t hurt SJM’s revenues either. Even with the entry of newcomers Las Vegas Sands and Galaxy Resort & Casino, SJM posted record profits in 2004 from its 13 casinos, raking in roughly $4.5 billion (MOP$35.2 billion) in total gaming revenue. Credits were given to SJM’s continued efforts in strengthening its organization, improving the professionalism of its staff by in-house training and re-training at Macau Millennium College, and introducing more themed casinos and attractive marketing campaigns. Also, Macau received 40% more visitors in 2004 than in 2003, and growth in the gaming sector jumped by 45%. SJM director Ambrose So says that both the mass market and the VIP market, which SJM has traditionally targeted and from which it currently receives nearly 80% of its revenues (and which accounts for nearly 70% of total gaming revenues in the territory), are likely to grow and that SJM is well placed to exploit the two. He comments, “The VIP market is a niche where you need to have a certain infrastructure, as well as connections, in order to attract customers. SJM has been in the region for over 40 years; we have an extensive network and we understand the Chinese market. In the meantime, we are also creating the facilities to capture more of the mass market.”

The $800 million Oceanus is Stanley Ho’s most ambitious project to date and will symbolize a sea of change for the new Macau.