In preparation for the upcoming Theme Parks & Resorts World Conference in Shanghai on 5-6 Sept, here I look at how the Genting model of integrated resorts is spreading around the world.
Recently Genting Group announced a major upgrade plan to bring new life into its Malaysian property in the Genting Highlands with the addition of a full-fledged 20th Century Fox outdoor theme park.
This is not the first time Genting goes big and bold. In the last few years we’ve seen the acquisition of a prime site in Miami, the opening of Resorts World Singapore and New York and more recently the launch of Resorts World Bimini as the world’s first cruise destination resort.
But how did that happen? How do you go from one property outside of Kuala Lumpur to being the world’s leading integrated resorts company? Well, let’s have a look, shall we?
Take Risk. Move Fast.
Being tightly run by Tan Sri Lim Kok Thay, the son of Genting’s founder, the group has the ability to move fast and take some risks. They thrive when the environment – legal, economic or political – is unfavorable but offer great opportunities for someone with a vision. And that vision comes from Tan Sri Lim Goh Tong – the founder – who decided to build Malaysia’s largest resort up a steep mountain, which did not even have an access road!
In New York, Genting invested US$450million to renovate and add slot machines at the Aqueduct racetrack in the midst of a scandal involving US politicians. Risky maybe, but being a non-US company certainly helped.
In Manila, at a time when nobody would have bet on the recovery of the Filipino economy Genting managed to close a deal in record time with local developer Alliance Global Group who was struggling to complete its mixed-use development at Terminal 3 of NAIA airport, which itself had remained unfinished and closed for more than 3 years. Together with their local partner, Genting managed to pull a few strings and the development – rebranded Resorts World Manila – now boasts 3 hotels and a 30,000sqm casino.
And in Las Vegas, Genting is adopting the same strategy again. They recently announced the acquisition of Echelon Place, another unfinished project, which they can probably turn around and open within 2 years.
Beyond thriving in unfavorable environments, Genting has successfully ridden various economic crises. This is what I would call their pioneering instinct.
1997 is the year Genting decided to start construction of the world’s largest hotel – First World Hotel – in the midst of the Asian financial crisis. They did it again in 2003 when they announced the launch of Star Cruises in a market just hit by SARS.
And this applies outside Asia too. The group’s recent aggressive expansion in the US started as the country was not yet recovered from the Great Recession. Same in Birmingham, where Genting announced a £150million development in a city hit by the European economic crisis.
Succeed where others fail.
When it comes to dealing with authorities, Genting will always tap their insecurities, concerns and expectations.
When bidding for a casino license in Singapore, they capitalized on the rivalry between Hong Kong and Singapore by proposing Universal Studios to compete with Disneyland and Marine Life Park to compete with Ocean Park, all in the same integrated resort!
Genting’s track record and experience with a variety of markets – including Asian – is also something authorities like. In New York, Genting is committed to putting in place programs to attract tourists from the nearby JFK airport and not only local Queens residents. In Las Vegas, their recent road show was all about demonstrating how they will attract Chinese and Asian tourists, which is high on the agenda of all US tourist destinations and critical for their survival.
Genting is probably the only casino operator who knows how to build a family friendly resort. This is strong in their DNA since Genting Highlands started as a mountain resort for the enjoyment of ‘all Malaysians’.
In many ways Genting is shaping the family entertainment industry through their unique concept of integrated resorts. They brought Universal Studios to Singapore and now 20th Century Fox to Malaysia, they started the first cruise destination resort in the Bahamas and when they come to Vegas in 2016 expect to see a live panda habitat, replica of the Great Wall, indoor water park and more.
Loyal to their Malaysian Chinese roots, Genting are excellent real estate people and they understand the value of a good location.
Whether it’s in New York where they are within 10 miles of a population of 5.6million, or in Singapore where they can tap in the huge Malaysian market – brought-in by coach loads – across the border in addition to a strong tourism from the rest of Asia into the city, or in Kuala Lumpur where they are within 1h drive of a population of nearly 6million, Genting’s Resorts World properties are guaranteed good traffic. A must for casinos!
And that leads to my final note. None of this would have been possible without casino licenses. So the question is: What comes first? The vision of building superior integrated resorts for ‘all’ families or the corporate drive of winning more casino licenses?