Taubman Asia Commits $200M to Macao’s Mall at Studio City
- Feb 01, 2008
Taubman Asia, a Hong Kong–based subsidiary of Taubman Centers Inc., will be acquiring a 25 percent stake in The Mall at Studio City, the retail component of Macao Studio City, a $2 billion mixed-use project under construction in Macao, on China’s southern coast.Subject to conditions that are expected to be satisfied within the first half of this year, Taubman’s investment will consist of an initial cash payment of $54 million, as well as allocation of construction debt and additional payments anticipated in years two and five after opening. The investment, expected to total approximately $200 million, is in a joint venture with Cyber One Agents Ltd., Macao Studio City’s developer. Cyber One is itself a JV between New Cotai L.L.C., a consortium of U.S. investors, and East Asia Satellite Television Holdings, a two-thirds–owned subsidiary of eSun Holdings, part of the Lai Sun Group, Hong Kong, which also includes Lai Sun Development, a hotel developer. Singapore-based CapitaLand owns the other one-third of East Asia Satellite Television Holdings.Ground was broken on Macao Studio City in January 2007; the hotel/entertainment/casino/retail project will include hotels by Ritz-Carlton, W and Marriott and the Playboy Mansion Macao. The Mall at Studio City will include approximately 140 stores, on two levels totaling more than 600,000 square feet of leasable area.”Retail sales in Macao continue to register strong growth, with the most recent reports available recording 37 percent growth in the third quarter of 2007 when compared with the same period in 2006,” Taubman Asia president Morgan Parker said in a prepared statement. “Outstanding categories include time pieces and jewelry which enjoyed sales growth of more than 50 percent and adult apparel which grew at a rate of over 40 percent year on year.”Based on 2006 numbers, the World Tourism Organization ranked Macau 21st in terms of tourist arrivals and 24th in terms of tourism receipts. According to the Macau government, visitor traffic grew from 9.1 million in 2000 to 22 million in 2006, with over 50 percent of the arrivals coming from mainland China and another 30 percent from Hong Kong. And according to the Macauhub news service, Macau was expected to receive 24–25 million visitors in 2007.