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Macau Property Prices Rising

24 June 2005

MACAU – As reported by Reuters: "The way Macau property prices are soaring while rows of new apartment blocks stand nearly empty, investors could be forgiven for thinking that the mushrooming casino business is providing the gas for a property bubble.

"The former Portuguese enclave on China's southern tip has drawn speculative flows from Shanghai, which is being officially cooled after an explosion of real estate investment, and Hong Kong, where rising interest rates are starting to bite.

"Macau developers can still sell sparkling high-rise blocks in just a couple of weeks, but buyers are taking a big risk. There is hardly any rental market -- only around a tenth of new apartments are lived in.

"…But the rampant speculation, mostly by people from Hong Kong and the rest of China, is based on economic fundamentals.

"…Investors are betting there will be a bigger boom in 2007, with the opening of the first phase of the Cotai Strip of opulent casinos, plush hotels and shopping malls, being built on about 5 sq km of land reclaimed from the silt-clogged Pearl River delta.

"The 60,000-room seven-casino three-phase project was dreamed up by Las Vegas gaming tycoon Sheldon Adelson. Hoteliers involved include Hilton Group, Marriott International and Four Seasons Hotels Inc…"

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