Macau, Cambodia to lead gaming recovery: Colliers

Friday 26th of February 2021

Macau GGR recovery will be driven by premium mass, whilst Cambodia’s gaming recovery will be driven by the VIP segment, according to analysts at Colliers International.

Govinda Singh, executive director & head of hotels & leisure for Colliers International wrote in a report that most of the recovery will be seen around Q3 of 2021, with Macau GGR reaching 50-60 percent of 2019 levels, whilst Cambodia GGR reaching 60 percent of 2019 levels.

Singapore, the Philippines, and Vietnam will lag behind, he added.

Singh said that China’s clampdown on international gaming tourism, opening up of regulated online gaming, Japan’s IR’s coming online, and new properties planned for Singapore, Cambodia, Vietnam, and Vladivostok will create downside risks - depending on whether GGR growth can keep up.

“What is needed and is possible is for the per capita income growth across Asia to continue its pre-COVID march; however, do expect paybacks to be longer, with business models focused on the mass market, and indeed marketed to a variety of source markets.”

Turning to the global hotel industry, Singh said he expects a V-shaped recovery this year, which will be dependent on the success of mass vaccinations in Europe and the US. A global return to pre-covid hotel performance levels is expected in 2023.

Singapore, which experienced an 85.7 percent decline in international visitor arrivals in 2020, will start seeing a recovery in its hotel industry following the resumption of MICE activities. A key event to look for will be the World Economic Forum, which is slated to be hosted in Singapore in August 2021.

"If the event takes place successfully, it will boost Singapore's MICE and hospitality sector
as it will prove that the city can host large global events despite COVID 19."

Colliers also turned their attention to Australia's hotel industry, which saw a challenging year in 2020 with a virtual complete border closure for the year. Singh notes that it is broadly anticipated that the domestic leisure segment will be the key driver of recovery. Though, the winding down of government stimulus packages may have an impact on consumer spending.

"Notwithstanding, domestic leisure still presents a shining light when compared to other segments," he said.