With Cuba’s doors now open again to American tourists, the island is looking a lot like Macau to a top Chinese developer. No one’s rolling in the baccarat, blackjack, poker and roulette tables just yet. But speculation about whether Havana could again be a casino gaming capital, as it was before communism under Fidel Castro, has spread to the East.
Macau, an administrative region of China off Hong Kong, became the Las Vegas of Asia and then far surpassed the original in gambling receipts, taking in more than $15.2 billion in the first half of 2015 — and that’s a lull from 2014.
After rule changes more than a decade ago, dozens of casinos arose in Macau. The peninsula includes casinos by Wynn Resorts (WYNN), Las Vegas Sands (LVS), MGM Resorts International (MGM) and Hong Kong-based Melco Crown Entertainment (MPEL) .
Cuba has parallels to Macau, the CEO of U.S. operations for China’s largest real estate developer, Greenland Group, said at a recent real estate conference in Miami.
“It’s a very short travel from here by ferry to Cuba,” I-Fei Chang of Greenland USA said when asked whether Chinese developers might plan projects there.
The extent to which Cuba might again embrace casino projects is as yet unknown. But, Chang said, “I can foresee some business model like from Hong Kong … a one-hour ferry to Macau, to build this Macau to be the casino and resort business.
Amid the red tape of longstanding sanctions, U.S. developers can’t as yet build in Cuba. But China has closer ties — it’s Cuba’s biggest trading partner.
Havana is about 220 miles from Miami. A little more than 180 miles off Florida’s coast, in the Bahamas, Chinese investors are involved in the four-hotel, $3.5 billion Baha Mar casino resort project, which filed for Chapter 11 bankruptcy protection in June.
Talks are underway this week to move the project forward after construction and money disputes. The general contractor is the China State Construction and Engineering Corporation, billed as the largest construction company in China, with some financing by the Export-Import Bank of China.
Chang said she didn’t know of any Chinese developers planning work in Cuba, but she linked the issue of future Cuba development to Miami’s own development.
"If Miami can continue its own investment to really build this great city to be a gateway city, not just the South Wall Street, I believe we have the opportunity to bring in more investors from Asia because then we’ll have more direct flights from China, because more business will want to be here and more tourists too.
Chang, a Yale graduate, was in Miami to take an initial look at South Florida as her company surveys which American property developments to consider next. She addressed the National Association of Real Estate Editors’ conference on June 26, five days before the U.S. announced the re-establishment of diplomatic relations with Cuba and its plans to reopen an embassy.
Greenland’s U.S. unit is a joint-venture partner with Forest City Enterprises (FCE-A) in the big Pacific Park (formerly Atlantic Yards) mixed-use project in Brooklyn, N.Y. It has put nearly $5 billion into the project, which entails 16 residential towers plus commercial and retail space. Greenland USA is also working on the Metropolis in downtown Los Angeles — three residential towers, a hotel and retail — in which it has invested $1.4 billion.
China’s state-owned Greenland Group has more than $57 billion in assets worldwide, according to a Knight Frank report. In China, it is involved in building the world’s third, fourth and seventh tallest buildings, among other projects.