Macau: Retail Market Poised to Benefit from Opening of Hong Kong-Zhuhai-Macau Bridge
Macau's retail market is expected to continue with its upward trend in 2018 with the support of robust local consumption, improved tourism, as well as successive launches of large-scale entertainment facilities and a raft of new infrastructure developments this year.
MACAU AND HONG KONG, March 03, 2018 – Macau's retail market is expected to continue with its upward trend in 2018 with the support of robust local consumption, improved tourism, as well as successive launches of large-scale entertainment facilities and a raft of new infrastructure developments this year, says JLL in its latest research study on Macau.
According to the figures released by the Statistics and Census Service, total retail sales in Macau grew by 12.6% y-o-y to reach MOP17.8 billion in the fourth quarter of 2017, hitting an all-time high in the last seven years since 2010. Total visitor arrivals in 2017 surpassed 32.6 million, up 5.4% y-o-y. The majority of the visitors were from Mainland China, accounting for 68%of the total visitor arrivals, followed by visitors from Hong Kong and Taiwan. Total spending by visitors to Macau amounted to MOP27.8 billion in 2017, surging by 21.1% y-o-y, with significantly higher spending on shopping and F&B seen from overnight-stay tourists. In 2015-2017 alone, the overnight-stay visitor tally rose by 22.2% to hit 17.28million, accounting for approximately 53% of total visitor arrivals and setting a new record in terms of quantity. During the same period under review, day-trip visitors registered a modest growth of 6%.
Oliver Tong, Head of Retail at JLL Macau, said: "The outlook for the retail sector in Macau is exceptionally promising in the light of the positive impacts that will be brought about by the completion of the Hong Kong-Zhuhai-Macau Bridge and other major infrastructure projects. We expect the Hong Kong-Zhuhai-Macau Bridge, which is planned to open to vehicular traffic sometime in 2018, will serve as a key catalyst for increased Macau visitation this year and beyond. The shortened travel time between Hong Kong, Macau and Zhuhai will help boost logistics and tourism, in particular the traffic from Mainland China, providing a strong momentum for future growth in the retail sector."
Supported by the ongoing long-term economic diversification plans laid down by the Central Government, Macau has been transforming itself from a pure gaming capital to a broad-based tourism and hospitality destination, offering a greater appeal for those seeking beyond traditional casino gambling. A number of large-scale entertainment complexes have sprung up these recent years, with several more coming online in two to three years' time. These projects, with the provision of a wide variety of facilities and services ranging from luxury shopping, themed entertainment, unique F&B concepts to MICE offerings, will no doubt influence the demographics of visitors to Macau in the years to come and open up tremendous new opportunities for the retail sector in the city.
In 2017, Macau's gaming sector rebounded with gaming revenues recording at MOP265.74 billion, up 19.1% y-o-y. While both the VIP and mass markets saw y-o-y growth in their revenues during the year under review, the VIP market remained the key driver for the growth of the gaming revenue, posting a y-o-y growth of 28.5% and accounting for 56.9% of the total gaming revenue in 2017. Looking ahead, with the gaming recovery going strong and visitor travels trending higher, Macau is set to enjoy a retail boom.
Terence Chan, Head of Retail at JLL Hong Kong, said: "The strong spending power of Macau's local customers and the increase in overnight-stay visitors have attracted more Hong Kong retailers to expand in Macau. Besides, benefitted from the advantages of lower set-up and operational costs, we are also seeing F&B operators open their establishments in the city for the sake of a higher profit margin."
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