Adelson does it again

Despite vigorous attempts by Singapore to discourage its own citizens from gambling, it’s not working. Even a $72 admission charge isn’t keeping them out. Better still, VIP junketeers are encountering smoother access than was expected. (Junket scrutiny in Singapore is far tighter than in Macao.)

On the downside, “CEO and hairman [sic]” Sheldon Adelson has proven once more that nobody can fuck up a megaresort opening like Las Vegas Sands. In what may be an LVS record, it’s only taken eight days for the $5.9 billion resort to attract its first lawsuit — or at least the threat thereof. Seems the Inter-Pacific Bar Association Conference is hopping mad to have arrived and found no available swimming pool or spa, malfunctioning telephones and plumbing, and toilets that didn’t flush. (Remember, some Palazzo rooms were opened to the public with no toilets whatsoever.) Supposedly, “the 1,000 members of the bar association had to sleep without air conditioners the first night of the conference,” which could be a sticky wicket in super-humid Singapore.

There’s more, lots more … and it wasn’t just the lawyers who were inconvenienced. Asia Sentinel is reporting “delays, management shake-ups, staff woes, construction problems” surrounding the opening, although that describes the entire history of this seemingly doomed enterprise. If Sands can’t get it up for its kickoff convention, that doesn’t bode well for making Marina Bay Sands the flagship for a new MICE boom in Singapore, especially when Sands’ own convention is ailing. As for the reputedly slipshod condition of the hotel — and Sands’ track record makes the accusations highly credible — it makes you wonder if truth-in-advertising laws ought to require Adelson to revise his company’s new motto to something like, “Las Vegas Sands: Where we just don’t care.” (Compare the situation, if you like, to Resorts World Sentosa‘s far smoother launch.) Analyst Mark Strawn, although bullish on Singapore’s “margin potential,” estimates it at a $4 billion/year market, which would seem to shoot Adelson’s $1 billion/year profit prediction right in the tuchus.

This comes atop news that the workforce at unfinished Sands Bethlehem has shrunk by 29% since opening day. Casino revenues are also — surprise! — 25% below management’s expectations. Cash flow has returned to earlier levels, suggesting the $743 million project might eke out a 6% return on investment this year. Given that completion of Sands’ master plan for Bethlehem (which included a museum) appears extremely unlikely and that Marina Bay Sands looks spartan compared to the lavish imagery above, what are the chances that Sands reports disappointing earnings along the Johore Strait … followed by a curtailment of the promised amenities and a plea for joint-venture partners to get the job done?