Discretion pays for Vietnam casino raking in wealthy Chinese
Discretion pays for Vietnam casino raking in wealthy Chinese
A small beachfront Vietnamese casino is giving Macau's VIP gambling scene a run for its money, drawing in more wealthy Chinese through its columned facade than many Southeast Asian rivals with the allure of sun, sand and discretion.
Few outside Danang have heard of the Crown International Games Club, a privately owned casino located along this rapidly developing city's main resort strip and which over the past year has emerged as the most exciting place for wealthy Chinese to drop bets worth at least HK$1 million ($129,030).
The popularity of this low-profile casino among the world's most prolific gamblers coincides with the waning fortunes of bigger, more famous rivals such as the opulent Wynn Macau and Grand Lisboa in Macau as a Chinese government crackdown on corruption and conspicuous spending batters the world's biggest gambling industry.
"This is a test case of a casino going under the radar that is doing extremely well," said Ben Lee, managing partner at Asian gaming consultancy IGamiX. "There is no other destination I know where the junket and casino organise 25 charter flights a week from China."
Crown's lack of renown can be put down to the Vietnamese government's reluctance to promote Danang as a destination for gambling, an activity which remains restricted to foreigners in this country which maintains a rigid stance on social order.
Owned by Chinese businessman Hui Kong, Crown is one of seven licensed casinos in Vietnam, already a popular destination for many Chinese tourists.
Its main gaming area - plushly decked out in beige and gold - and 13 VIP rooms are about a quarter the of an average Macau casino, but industry executives estimate monthly VIP turnover has increased over the past year to $3 billion a month, a figure at least double what larger rivals such as Solaire in the Philippines, NagaCorp in Cambodia and Genting Highlands in Malaysia rake in.
Crown executives declined to give any financial details.
"Right now many people come here mostly to gamble," said James Yang, marketing director at the luxury Crowne Plaza which flanks the casino. The hotel, managed by the Intercontinental Hotels Group, caters to its mainly Chinese guests by providing a sauna, a karaoke parlour and Mandarin-speaking staff.
The resort complex, already Danang's largest, will also double the number of its rooms as part of a $600 million redevelopment plan that includes opening a JW Marriott-branded hotel, a duty free shopping mall and an expansion of the casino.
Not just punts
Several companies are also betting on Vietnam, which analysts say could become a major Southeast Asian casino hub if it allows locals to gamble. Augustine Ha Ton Vinh, a professor who advises the government on the gambling industry, said this restriction is likely to come up for debate next year.
Hong Kong-based Chow Tai Fook Enterprises and VinaCapital are building an up to $4 billion casino resort in central Quang Nam province which is due to open by 2018, while the Ho Tram, a casino backed by U.S. hedge fund Harbinger Capital, is expanding its premises on a beach a two-hour drive from Ho Chi Minh City.
So far, Chinese are the biggest client base for Vietnam's casinos and Crown, like its peers in Macau, works with junket operators, typically companies which loan credit to VIP gamblers and help them bypass China's currency controls.
At least 10 of these junkets are now only focusing on Danang, industry executives say, as the slump in Macau's gaming industry pushes their business model to the brink of collapse.
"Customers like the environment here much better," said junket operator Hugo Huang as he sipped fresh coconut juice inside a private dining room adjacent to the casino. "We have beautiful beaches, cultural sites and it's very easy for Chinese to feel comfortable."
Huang, who also runs VIP rooms in Macau and Cambodia, charters two flights a week from China to Danang. Last month, he flew in 100 VIP gamblers from China for a golf tournament, capping off the trip with a gala dinner and pop music concert.
Playing up all the leisure activities Danang has to offer fits in with the government's drive to rebrand the former wartime outpost for U.S. soldiers into a tourist destination for all.
"At the moment, we are positioning ourselves as a leisure, beach and meeting and conferencing destination," said Nguyen Xuan Binh, director of Danang's tourism promotion office.
Asked about Crown, with its impossible-to-miss glitzy facade and elaborate fountains, Binh said he had never heard of it. ($1 = 7.7501 Hong Kong dollars).
