HONG KONG — The City of Dreams casino and resort is to open Monday in Macao with fanfare and fireworks and two scions of the gambling industry in Asia — Lawrence Ho and James Packer — due to preside over the ribbon-cutting before a star-studded party and a stage show next to a specially built lagoon.

High rollers will stay in the Crown Towers. There is also a Hard Rock Hotel, featuring the rock memorabilia that are the chain’s trademark. Tourists can pore over Madonna’s hot pants and bustier, Pink’s guitar, Michael Jackson’s silver sequined glove, Jacky Cheung’s scarf, sweater and bow tie and a yellow fur coat with black trim that the King himself, Elvis Presley, once wore. A Grand Hyatt hotel is scheduled to open later this year.

Analysts and executives say the opening is a vote of confidence in Macao, now the world’s largest gambling market, at a time when not much has been going right for the city.

“The fact that the City of Dreams has had the confidence to go ahead and get on with it when everyone else is having second thoughts is very good,” said Warren Rooke, a 15-year resident of Macao and a director of Bay Property, an investment advisory company. “It gives a tremendous boost.”

Just down the road from the complex, whose construction cost 18.4 billion Hong Kong dollars, or $2.4 billion, stands a warning sign of what can go wrong.

The concrete skeletons of the Shangri-La, Sheraton, Traders and St. Regis hotels stand idle, dormant since their developer, Las Vegas Sands, ran into financial trouble.

The City of Dreams is the first major casino to open in almost two years in the former Portuguese colony, since the Venetian Macao opened in August 2007. Both the City of Dreams, which features a 39,000-square-meter, or 420,000-square-foot, casino, and the unfinished hotels sit on the Cotai Strip directly opposite the Venetian, which at 51,000 square meters houses the largest gambling hall in the world.

The long stretch of reclaimed land they all inhabit could become Macao’s equivalent of the Las Vegas Strip. Macao, now an autonomous special administrative region of China, is the only place in China where casinos are legal. Half of Macao’s visitors come from the mainland; the figure rises to 82 percent when neighboring Hong Kong, also a special administrative region, is included. But the financial crisis, as well as austerity measures in China, have bitten hard into Macao’s boom.

Macao’s gambling revenue was up 31 percent in 2008. The first quarter saw a dip of 13 percent, but March was still the seventh-best month on record. Macao’s gambling revenue now exceeds those of Las Vegas and Atlantic City, New Jersey, combined.

Aaron Fischer, the head of Asian property and gambling research at CLSA Asia-Pacific Markets, forecasts that gambling revenues in Macao will rise 2 percent this year to 110 billion patacas, or $13.7 billion. That is more optimistic than the estimates of most analysts, who expect a slight decline.

“The numbers are saying it is still very, very strong,” Mr. Fischer said. “We are super-bullish on Macao.”

He expects the City of Dreams to be the “tipping point for the development of Cotai,” since it is aimed at younger, mass-market tourism. Its futuristic theme also expands what is on offer at Cotai, where the Venetian simply copied an existing Las Vegas casino.

Morgan Stanley’s analysts also expect gambling revenues to recover in the second half of the year. But they note that new casinos are becoming less profitable. They expect the City of Dreams to improve visitor numbers but to add to already fierce competition, especially with the Venetian.

The City of Dreams will have a domed theater, the Bubble, with a multimedia show based on Chinese mythology. It will also house a permanent show by Franco Dragone, the former Cirque du Soleil director who shaped Céline Dion’s show in Las Vegas. And it will ultimately have 175,000 square feet of luxury retail space.

Source: The New York Times

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