Jun
17
Melco PBL updates Cotai City of Dreams
Filed Under Macao, Cotai, Melco PBL, Wall Street, Hard Rock Macau, City of Dreams, Grand Hyatt Macau, Crown Towers Hotel | Leave a Comment
(3 of 3 Melco PBL postings today)
Up, up and away!
Melco PBL issued a press release that it has secured a US $2.75 billion loan that includes two sub-headings about its Cotai City of Dreams that i’ll talk about. Take a look back at my posting from March after Melco PBL raised its budget for Crown Macau. At the time, I couldnt help but wonder how much City of Dreams was going to end up costing. I’m guessing there’s more increases to come.
1) Announces Substantial investment in Cotai Serviced Apt Hotel Units
The budget was raised from US$96 to $US353 due to a significant change in scope. The company does believe however that the proceeds from the sales of these apartment hotel units will end up reducing the net capital investment of the Cotai City of Dreams.
2) Completes Cotai’s City of Dreams Project and Program Review
Budget raised 23%, from US$1.5 billion to US$1.849 billion due to an increase in scope. The thing with the “increased scope” excuse is that its always tough to determine how much is really “increased scope” and how much is poor planning and rising construction costs. To the company’s credit, the do say that the rise in costs is almost proportional to the increase in gross square feet (3.6 million to 4.2 million), with only 6% of the increase is from inflation.
The company also gives an opening date of March 2009 for its Phase I City of Dreams with the following description:
…consists of substantially all of the 420,000 square foot casino and approximately 85,000 square feet of retail space, as well as the 366-room Hard Rock Hotel and the 295-all-suite Crown Towers Hotel, Cotai. The 1,005-room Grand Hyatt Macau twin-tower hotel is scheduled to open in September 2009.
The entire press release can be found here