19 July 2021
Cyprus is already a highly desirable investment destination and, once Europe’s biggest integrated resort – City of Dreams Mediterranean – opens in Limassol in 2022, it will raise the bar in premium hospitality and entertainment tourism, says Lawrence Ho, Chairman & CEO of Melco Resorts & Entertainment. Here he outlines his vision for the forthcoming resort and explains what led him to choose Cyprus for the company’s first investment in Europe.
By Marianna Nicolaou
What made you consider Cyprus as the destination of your first investment in Europe? How does Cyprus compare with the other jurisdictions in which you have invested?
Cyprus is a country that offers an attractive set of competitive advantages to investors. Prior to our decision to expand our operations to Cyprus, we performed thorough research by carefully analysing and evaluating factors which could influence the company’s long-term growth. One main driver that led us to choose Cyprus was the country’s geographical location. Drawing on its strong position as a destination with established transport links to Europe, the Middle East and Asia, we continue to believe that Cyprus has all the prerequisites to enhance its reputation as a regional and global premium ‘must-visit’ tourist destination and emerge as a genuine point of reference for premium tourism. Additionally, the country possesses other important assets: it is blessed with approximately 300 days of sunshine, has advanced infrastructure and an abundance of highly educated and skilled individuals. It should be noted that every jurisdiction has its own system and regulatory policies but the fact that Cyprus maintains a transparent and efficient regulatory environment was also a key reason for us.
What metrics do you track when considering whether to invest or not?
There are various factors that render an investment sustainable and attractive. In the case of Cyprus, as I have mentioned, its location was important. Additionally, when examining whether to invest in a destination, we take into consideration the country’s legal and socioeconomic environment, its infrastructure, especially with regard to hospitality, transport and tourism, as well as the level of its human capital and, of course, its potential for further growth. Cyprus meets all these criteria and possesses a forward-looking outlook, with a view to developing and diversifying its economy, something that is shared both by the Government and by business stakeholders. By drawing on the advantages it has to offer and, at the same time, addressing its weaknesses, the country can further enhance its capacity as an international business destination.
How would you rate your experience as an investor in Cyprus? Are there actions that could be taken in order to further enhance Cyprus as an investment destination?
Melco maintains close cooperation with Cypriot authorities both at an executive level – the Cyprus Government and especially the Deputy Ministry of Tourism – and at a municipal level, via our collaboration with the Municipality of Limassol and other Municipalities where the C2 satellite casinos are operating, as well as with various local stakeholders. Our partnership is rooted in our shared goal to establish Cyprus as a globally renowned destination for tourism and entertainment for all seasons, expanding the country’s tourism product and contributing to sustainable economic growth. It was natural to face some challenges as we were introducing a new concept to Cyprus, given that City of Dreams Mediterranean is its first integrated resort (IR). Overall, our experience has been positive but, of course, there is always room for improvement. Special mention should be made of our partners, the CNS Group. Having strong local partnerships is one of the most important factors for success when it comes to investing in a foreign country. I believe that Cyprus has great potential to become a regional hub for inward investment. Diversifying the country’s economic base will contribute to attracting investment in emerging sectors that are driving growth around the world today, such as the digital economy, cleantech, renewables, supply chain and logistics. Implementing more transparent and efficient procedures in public services is also crucial to this end. Improving Cyprus’ air connectivity can also generate a substantial boost, while the introduction of a ferry service with neighbouring countries besides Greece, whose development is ongoing, such as Israel, Lebanon and Egypt, is also paramount.
Everyone expects City of Dreams Mediterranean to improve the country’s tourism product, and not only by the addition of a casino. How will such a resort attract an expected 300,000 more visitors to Cyprus every year?
City of Dreams Mediterranean will be more than a gaming destination. We want to create a premium resort for sophisticated travellers, which will raise the bar not only in entertainment and premium tourism but also in international business and conference tourism, given the superior quality of the IR’s MICE facilities. The IR will feature a fourteen-storey 5-star hotel with more than 500 guest rooms and suites, approximately 10,000 square metres of MICE space, an outdoor amphitheatre, a family adventure park, and a variety of fine-dining restaurants and luxury retail outlets. I’d like to note here that, as part of this effort, Melco has formed a strategic alliance with the Deputy Ministry of Tourism to collaborate on a series of actions aimed at shaping a more resilient and sustainable model of tourism development. The two parties will work closely to promote special forms of tourism, such as leading conferences and sporting events, while exploring new niches and market segments. Intensive campaigns will be carried out to raise awareness and anticipation of the project as well as to promote Limassol and Cyprus abroad. In fact, the launch of City of Dreams Mediterranean will be a major milestone for Cyprus. As it becomes the country’s’ first and Europe’s largest IR, it will open new prospects to transform the country’s tourism industry.
How has the COVID-19 crisis affected your plans/operations? When do you now expect the resort to be completed?
Travel and tourism were among the sectors hardest-hit by the COVID-19 pandemic, as businesses operating in those industries were forced to suspend their operations for extended periods. Our Cyprus Casinos operations were also paused to curb the spread of the coronavirus, as part of the various lockdowns and restrictions that have taken place since the start of this health crisis. The pandemic also affected the construction progress of the IR but the project is now advancing well towards completion and construction work is progressing smoothly, with City of Dreams Mediterranean being set to open in summer 2022. Despite these challenges, we remain committed to this ground-breaking project, which will create thousands of job opportunities and significantly contribute towards enhancing Cyprus’ tourism product.
Do you believe that the pandemic will change casino-related tourism in any way?
Travel restrictions undoubtedly pose serious challenges but we are optimistic that the industry will bounce back. As the vaccination rollout against COVID-19 continues to progress globally, we expect to see results in the coming months, given that people will start travelling again. Nevertheless, we expect the recovery to be gradual and the real value to be in the medium- and long-term prospects for the industry. The case of Las Vegas could provide a glimpse of how gaming-related tourism will look after the pandemic. The casinos there have re-opened, following the successful vaccination rollout in the US. The gaming-related economy in Las Vegas has already bounced back to pre-pandemic levels, with reports showing increases in airport passengers and tourism, and a big jump in revenue, exceeding that of March 2019. Melco leveraged the pauses in gaming-related activity to invest in people and technology at our global destinations, in order to automate workflow, boost productivity and ensure game protection and fair play.
What is the vision you wish to implement through the construction of City of Dreams Mediterranean?
With City of Dreams Mediterranean, we want to create a landmark for Cyprus to raise the bar in premium hospitality and entertainment tourism – becoming a point of reference for the region, while providing real value to the local economy and society. As the largest integrated resort in Europe and the region, the project will lead to the creation of approximately 2,500 permanent jobs once it’s fully operational, while contributing to approximately 6,500 direct and indirect full-time jobs. At the same time, we seek every opportunity to boost the local economy by working with local suppliers and businesses. Apart from the creation of new jobs and a chain of value into the local economy, the IR’s launch will contribute to upgrading the island’s infrastructure and hospitality services to the highest standards, attracting high-revenue visitors and combatting seasonality. City of Dreams Mediterranean also aspires to become one of the most sustainable resorts in the region, setting an example for future developments. The IR is constructed to the highest sustainability standards and was recognised recently with a BREEAM ‘Excellent’ rating for its design phase, becoming the first building in Cyprus to achieve this honour. BREEAM is the world’s leading method of assessment for the sustainability of infrastructure projects. The IR will provide extraordinary benefits to Cyprus’ economy with a positive effect on the country’s GDP. We are aware of our pivotal role in the growth of the tourism industry and Cyprus’ overall economy, hence, we will work tirelessly to ensure that, following this crisis, the country will emerge as a global destination for luxury tourism. Ι strongly believe that Cyprus has a bright future ahead.