Quite Likely Over Budget, Resorts World Sentosa Expansion Won’t be Finished Until 2028
The overall cost of Singapore’s Resorts World Sentosa (RWS) casino complex’s expansion program is probably going to exceed the initial estimated figure of SGD4.5 billion (US$3.36 billion). Following the announcement of the company’s fourth quarter results, the management of Genting Singapore Ltd, the property’s operator, gave the information during a private conference call with financial analysts.
Genting Singapore committed to the city-government state’s by announcing the expansion initiative in April 2019. The so-called “2.0” expansion of Resorts World Sentosa, or “RWS2.0,” is a part of a deal that allows Genting Singapore to retain control of half of Singapore’s casino duopoly through 2030.
According to management’s comments made during the company’s Monday conference call, “for ‘RWS2.0,’ management indicated upside risk to the earlier budgeted amount of SGD4.5 billion due to cost escalations,” wrote analysts Tushar Mohata and Alpa Aggarwal of the banking organization Nomura in a note on Genting Singapore.
Just that their expansion projects under “RWS 2.0” had “commenced” was all that Genting Singapore stated in its fourth-quarter results filing to the Singapore market. In addition to “supporting infrastructural facilities to accommodate to the overall growth” of the resort, they included “the ongoing building” of the Singapore Oceanarium and of Minion Land at the Universal Studios Singapore amusement park.
Based on the wildly successful Hollywood animation brand starring the “Minions” characters, Minion World is scheduled to open in 2024.
The expected budget increase for “RWS2.0” was “due to increasing material costs,” Maybank Investment Bank Bhd stated in a Tuesday note that also made mention of Monday’s conference call with Genting Singapore’s management.
The completion of “RWS2.0” could “be postponed to as late as 2028 or [a] half-year to one-year after “MBS2.0,” according to analyst Samuel Yin Shao Yang.”
The latter made reference to a different expansion project underway at the Marina Bay Sands hotel, which makes up the other half of Singapore’s casino duopoly. The initial budget for the “MBS2.0” expansion program, which was also announced in April 2019, was SGD4.5 billion.
A division of the US casino operator Las Vegas Sands Corp. oversees Marina Bay Sands. The casino corporation stated in April of last year that it has reached an agreement on a modification to its original agreement with the Singaporean government, which “extends the timeframe for the firm’s Marina Bay Sands gaming facility to initiate development of MBS2.0 by one year, to April 8, 2023.”
Las Vegas Sands stated in its most recent annual report that it was “in the process of assessing the budget and timing of the Marina Bay Sands project based on the impact of the Covid-19 epidemic and other circumstances” earlier this month.
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