As the $4.2 billion Wynn Palace Cotai casino resort from operator Wynn Resorts Limited gets set to open its doors on Monday, news has emerged that the nearby Studio City Casino Macau development could be about to default on its loan.

According to a report from the Teledifusao De Macau radio and television broadcaster, the $3.2 billion Studio City Casino Macau, which is controlled by operator Melco Crown Entertainment Limited, opened in 2015 without VIP tables in an attempt to appeal to families and China’s growing middle class. In the face of Chinese President Xi Jinping’s ongoing anti-corruption drive and a weakening economy, diversification was widely seen as a safer bet and the giant development also comes complete with a Batman ride and a magic show alongside hotels and restaurants.

However, Teledifusao De Macau reported that such new facilities have consequently struggled to attract new customers with visitor numbers to the former Portuguese enclave falling by 2.6% year-on-year to 30.7 million in 2015 while remaining unchanged through the first six months of this year.

As a result, rating agency Standard And Poor’s Financial Services has given a negative outlook to the development’s bonds and warned that Studio City Casino Macau could soon default on the $1.41 billion loan it used to finish off construction.

A report published by the Bloomberg news service on Monday explained that Studio City Casino Macau may also have trouble borrowing additional cash to repay its existing debts with the first victims likely to be Melco Crown Entertainment Limited’s 40% partners in the property, American hedge funds Silver Point and Oaktree Capital. It declared that bonds issued to the investors have dropped to just 42.5% of their original value while Hong Kong-listed Melco Crown Entertainment Limited, which holds the remaining 60% of the investment, is distancing itself from any rescue scenarios.

“Studio City Casino Macau is within an entirely separate credit group and its debt is non-recourse to Melco Crown Entertainment Limited,” Melco Crown Entertainment Limited told Bloomberg. “Investors should not assume that Melco Crown Entertainment Limited will provide any financial support to Studio City Casino Macau or that it would step in for Studio City Casino Macau.”

Bloomberg alleged that many analysts believe Melco Crown Entertainment Limited would like to take full control of the Cotai resort casino the negative outlook may help in its future negotiations. Lawrence Ho Yau Lun, the operator’s Chairman and Chief Executive Officer, told financial magazine Barron’s Asia two months ago that he was in “no rush” to buy out the minority partners as both sides remained far apart on how much money the development is worth.

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