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Melco partners with $616m non-gaming project in China

Melco International will be partnering with mainland Chinese developer Agile Group Holdings for an RMB4bn ($616m) entertainment complex in Zhongshan, China.

Zhongshan

The property is predicted to be completed by 2025, with 51% of the stake going to Melco.

The project should be centred around residential, entertainment and hospitality mixed-use. The complex would have a gross floor area of 750,000 square metres and will include office areas, hotels, service flats, wellness centres, malls and a theme park.

The chosen city is located in the Greater Bay Area, with connections to both Macau and Hong Kong. “Over the past 15 years, Melco has been creating, developing and operating world-class entertainment facilities in Macau and globally,” said Melco CEO Lawrence Ho. “We are determined to play an active role in the development of the Greater Bay Area, and to leverage the incredible expertise of the group in non-gaming activities.”

Analysts believe the project is a smart move on Melco’s part. It will strengthen the company’s presence in China, which will benefit its chances of concession renewal.

“They bypass the usual Macau conundrum of lack of land, labour and government efficiency and have gone straight to the heart,” said Ben Lee, managing partner at iGamiX Management & Consulting. “Developing non-gaming diversification in an environment and market which will support that kind of investment.

"They obviously believe you don’t have to necessarily invest in Macau to win the attention of the true decision-makers.”

Considering the limited land availability in Macau itself, the neighbouring areas offer a great opportunity for expansion within the Greater Bay Area. Galaxy Entertainment, for example, has already secured land on nearby Hengqin Island.

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