According to Macau Business Daily, a minimum of 8 VIP gaming rooms should be closing, either already having done so in August or soon to be in September. The VIP business of Macau is struggling, leaving junket operators with no other options but to close.
The gaming operations in the VIP sector are under great competition from operators in Southeast Asia as well as the inability for gaming debts to be repaid by Chinese gamblers. These issues have been reported by the Forefront of Macau Gaming group as well as the Association of Gaming and Entertainment Promoters in the area.
Among those with closed down rooms is the prominent Golden Group. Another major operator, David Group, seems to have only one VIP gaming room remaining. That venue is said to be in the Wynn Macau, which is a big downsize from the seven rooms they originally operated since the start of 2015. The company so far has not commented on the matter after denying such reports in early June.
According to Lei Kuok Keong the Forefront of Macau Gaming Deputy Director, the operation costs of VIP rooms are too high. Then add in the inability for gamblers to repay their debts, the VIP groups are losing money fast.
Lei stated that as many as 3,000 resident employees have been affected by the closure of the VIP rooms this year, which is in the 40 to 50 room range. A serious case includes the Heng Sheng Group, which last year had 700 employees and 11 VIP rooms. This company reportedly now has only four rooms remaining in Macau and the number of staff members has been depleted to 100.
According to Lei, the closures of VIP rooms should continue as there has been no sign of the VIP industry getting their head above water. The slowing Chinese economy is affecting many areas of Macau but heavily in the area of VIP gaming.