IR Rivals, North And South

Source : TODAY, Thursday, April 17, 2008

A YEAR before Singapore's first Integrated Resort (IR) at Marina Bay is due to open, potential competition is already brewing to the immediate north and south.

In Malaysia, the government yesterday confirmed it is in talks with not just Walt Disney, but also other theme park operators. The discussions are "preliminary", said spokesman for Malaysia's sovereign wealth fund, Khazanah Nasional, Mr Mohd Asuki Abas. Some 890 hectares have been set aside for theme park use.

The park in Johor would compete with Universal Studios at Resorts World at Sentosa. Buzz of a theme park began as far back as 2005 when Malaysia toyed with the idea of wooing Mickey Mouse.

In the south, Malaysia's Landmarks is hoping to set up Indonesia's first legalised casino on Bintan island — details of which were revealed by chief operating officer Lim Boon Soon in a Bloomberg report yesterday. The US$3.1-billion ($4.2-billion) resort aims to compete with the one at Marina Bay here.

With Singapore planning to double the number of overseas visitors to 17 million annually and triple tourism receipts to $30 billion by 2015, Landmarks aims to capture the spill over.

"It could work, though the execution risks are there," said Mr Keith Wee, an analyst at OSK Research. With casinos in Malaysia as well as Singapore, "competition will be tough".

How much of a threat will both developments pose to Singapore?

Industry players Today spoke to said issues of accessibility stand in the way of the upstarts. While Johor has an airport, those in Singapore wanting to cross over may face traffic jams on the Causeway; Bintan has no airport yet and the ferry ride from Singapore takes 55 minutes.

And travellers will likely drop by Singapore before visiting the other two. "It's very unlikely that they will give Singapore a skip as we are a hub and they have to come through," noted Mr Robert Khoo, chief executive officer of National Association of Travel Agents Singapore.

For tourists looking for a complete getaway, Landmarks' Bintan resort will bank on the island's current tourist offerings. The developer will also offer private luxury villas with berthing facilities, condominiums and health spas. Said Mr Lim: "Five years down the road, having a casino won't be special."

Indeed, Resorts World at Sentosa — slated to open in 2010 — features wholesome family treats like Universal Studios' theme park, a maritime museum and a luxury spa.

Such distinguishing features mean that the two resorts are complementary, said an in-bound tour operator.

Tour East's group vice-president for sales and marketing, Ms Judy Lum, said Bintan can be marketed as an adult getaway and Sentosa a family destination.

As for the IR downtown, Marina Bay Sands told Today it will be a "world-class destination not available anywhere else in the region".

A Disneyland across the Causeway could rival Universal Studios as it "would have the domestic mass to support it and it would probably attract Middle Eastern tourists", said Ms Lum.

"But it needs to be well-managed and well-maintained consistently," she qualified, noting that many theme parks there are not.

Concerns about competition may well prove moot. In 2006, when the Malaysian authorities said they had discussed the project with Disney, the American company denied it.

In Indonesia, Landmarks has yet to finalise the terms and conditions of the gaming business with the authorities.