Since China cracked down on corruption in its Macau casinos, Asian VIP junkets have been looking for new destinations to place exorbitant wagers on their favorite table games, like baccarat. With that in mind, Donaco International Ltd, owner of Cambodia’s Star Vegas Resort, developed a neighboring casino at Star Paradise Hotel, and after a month of operation, the company says it’s lived up to all expectations.
Asian-based Donaco operates Star Vegas International Resort & Casino Hotel in northeast Cambodia, attracting Asian VIPs across the border from Thailand, and the Aristo International Hotel in Kim Tân, Vietnam, just across the southern border of China.
The company opened the gaming floor at its new Star Paradise casino, neighboring Star Vegas, in September, and Ben Reichel, Executive Director for Donaco, told GGRAsia they are quite pleased with the progress after just one month.
“September was the first month of operations at Star Paradise,” said Reichel in an email communique. “The performance has met expectations, with a number of VIP junkets and players sampling the new facilities,” he added.
Star Paradise is a small-scale gambling property compared to major operators in places like Macau and Las Vegas, but is a perfect fit for the location and relative population of gamblers it intends to attract. Reichel confirmed that the gaming floor is equipped with “40 tables… at the moment”, and that there is enough space to accommodate about 50 pokies machines.
It’s sister site, Star Vegas Resort, is a bit larger, featuring 86 table games and about 130 pokies.
When Donaco acquired Star Vegas Resort last year, there was a clear demand for additional gaming space; thus negotiations to the develop of a neighboring gaming floor at Star Paradise came about naturally. Donaco’s annual revenue report, published late last month, confirmed the company had begun “managing the newly constructed gaming floor of the Star Paradise business for a monthly fee”.
The owners of Star Paradise have agreed to pay Donaco Intl THB-5 million (USD-$144,173) per month to operate the new casino under the existing license of Star Vegas Resort. They will also cover any costs incurred by Donaco for operating the gambling venue on the property.
The redevelopment of the Star Paradise property to include a gaming floor was financed by an unnamed partner of Donaco, based in Thailand. The operator has strategically positioned itself in an advantageous spot, having exclusive rights to purchase 100% of the property, along with its hotel.
“By managing this gaming operation we are well positioned to assess the attractiveness of this business to the Donaco group,” the company’s annual report explained.
Considering the current profitability of the Star Vegas Casino property – which dominated the company’s portfolio by contributing “AUD120 million in revenue and AUD87 million in underlying EBITDA” in the fiscal year ending July 2016, according to Managing Director Joey Lim Keong Yew – if Donaco is presented with an opportunity to acquire Star Paradise, it will waste no time in negotiating the deal.