South Korean Developer Courts Harrah’s for Casino at Cambodia’s Angkor Wat
By Daniel Ten Kate – Jul 29, 2010
South Korean developer Intercity Group plans to start construction in October on a $400 million casino resort complex near Cambodia’s Angkor Wat temples that aims to draw high rollers from Macau and Singapore.
Harrah’s Entertainment Inc., the world’s biggest casino owner, and MGM Resorts International, the largest casino owner on the Las Vegas strip, are among companies that were invited to visit the site, James Cho, Intercity’s vice president, said in an interview. The first phase of the project, Cambodia’s largest casino to date, is set to finish in 2012, he said.
“All these big guys are interested in operation management deals,” said Cho, who holds a graduate degree from Columbia University. “We’re confident because the feasibility is there and gaming concessions in this region are so rare.”
Intercity is betting the casino complex, with an investment value equivalent to about 4 percent of Cambodia’s gross domestic product, will draw Asian gamblers looking for an alternative to more established gambling centers. Singapore opened Resorts World Sentosa in February and Marina Bay Sands in April, and Vietnam has approved a $4.2 billion casino set to open in 2013.
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Funding Challenge
Raising funds may prove difficult in the current financial climate given the project’s scale, which is bigger than most casinos outside Singapore and Macau, said Sean Monaghan, an industry expert who formerly worked as a gaming analyst at Merrill Lynch & Co. Success may hinge on showing investors ties to junket operators in Thailand and China, he said.
“Even though Siem Reap sounds goods, most of the people that go there aren’t really casino players,” Singapore-based Monaghan said. “You have to have a very, very solid team to pull that financing off.”
MGM representatives “accepted an invitation to meet and visit the site,” spokesman Gordon Absher said by e-mail. He declined further comment on the project.
Jacqueline Peterson, a spokeswoman for Las Vegas-based Harrah’s, didn’t immediately respond to an e-mail sent after regular office hours or answer a call to her mobile phone.
MGM doesn’t plan to invest its own money in the project, though may consider managing the casino for a fee, Cho said.
Intercity declined to reveal how much funding has been raised so far. The tourist draw of Angkor Wat, the 12th century Hindu temple, an international airport and “tons” of incentives from the government, including corporate tax holidays and low gaming levies, will make the project viable, Cho said.
“Not everybody’s going to gamble in Macau or Singapore,” Cho said. “Cambodia is family friendly and it’s cheaper.”
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