The massive investment in Macau has rolled over into a huge growth in employment in the region.

When the Macau government opened its gaming sector in 2002, offering up three concessions for bids, it immediately received immense international response from 21 bidders from the world’s most famous gaming names. One bid was won by local incumbent Stanley Ho, another by Las Vegas king Steve Wynn, and the third by a little-known consortium of Hong Kong-based investors called Galaxy Resort & Casino. Today, however, and on closer inspection, one sees a greater wisdom in the government’s and Chief Executive Edmund Ho’s decision. Galaxy Resort & Casino is Asian, and it quietly won its concession bid and launched its hotel-casino two years ahead of the high-profile Wynn Resorts, capturing 14% of the VIP market in just over a year. In the same discreet fashion, Galaxy is now calmly uncoiling its tentacles to claim of much larger share of Macau’s lucrative gaming pie.

Galaxy Resort & Casino is playing its cards right, using its combined experience and understanding of the Asian gaming market to provide something unique.

“Galaxy will be known as the Asian gaming giant,” claims CEO Anthony Carter. “We will not be simply introducing a Las Vegas model. We will remain very much an Asian organization, and not just in the sense of using Asian decor, but in the way we approach things, the way we deal with people, the way we talk to them, and in the service we provide.” Mr. Carter says that gaming in Asia is much different than in Las Vegas and much tougher. Asian gamblers bet hard and fast and are not looking for frills such as expensive meals and showroom dancers. They drink tea and eat simply while betting up to $250,000 a hand. “Compared to the U.S. gambler, you’ve got a completely different profile,” he explains. “Gaming is about people. You have to look at the profile of the people, and that, I think, is going to be the main difference for Galaxy. We approach it from an Asian point of view. One of our strengths is the fact that we are dedicated to Macau, both in terms of resources and management. We are not distracted by bidding in Singapore, or operations in Las Vegas or Atlantic City, or anything else. We are totally focused here.”

As it turns out, the names behind Galaxy were anything but small-time operators. Originally majority controlled by Hong Kong tycoon Lui Che Woo and his family, Galaxy also represented a minority interest from Macanese businessman Pedro Ho and investment firm Guoco Group, which is owned by one of Malaysia’s largest business families. This year Mr. Lui gained approval from the Macau government for his Hong Kong firm, K. Wah Construction Materials, a subsidiary of K. Wah International Holdings Ltd., to buy a 97.9% interest in Galaxy. The new company will be renamed as Galaxy Entertainment Group and will be the first publicly traded casino on the Hong Kong Stock Exchange. K. Wah International Holdings Ltd. also owns Stanford Hotels, which has 17 hotels in the U.S. and three in Hong Kong, as well as Cresleigh Properties, which owns five office buildings in downtown San Francisco.

Galaxy opened the Waldo, its first hotel-casino in Macau, in 2004 and will invest a further $1 billion over the next three years in four other ventures. Two new casinos will be opened this year: Galaxy’s City Club and its first mass-market casino. The 33-floor five-star Galaxy Star World Hotel resort, representing an investment of $250 million, is expected to open in June of 2006, and the massive $375 million Galaxy Cotai Mega Resort and Casino will be completed in 2008. Located on a stretch of reclaimed land called Cotai that investors are hoping to convert into a Las Vegas style casino strip, the mega-resort will feature 6,300 hotel rooms and nearly 450,000 square feet of gaming.

Galaxy’s CEO, Mr. Carter, says that the liberalization of Macau’s gaming sector was a stroke of genius on the part of Chief Executive Edmund Ho and the changes that Macau has experienced in the past three years are astonishing, especially in terms of job creation. He comments: “I think the single greatest benefit that all the concession holders have brought collectively has been a huge growth in employment. The figures are something like 100,000 new jobs over the next five years. That is only in the gaming industry and hotels, and not counting the service sectors. We alone will employ more than 10,000 people by the time we are finished.”