In 2006, not long after gambling mogul Steve Wynn opened his first luxury hotel-casino in Macau, one of his top lieutenants took me on a tour. We began outside at the “Performance Lake,” a multimedia ballet of music lights and water jets, then worked our way along a concourse of luxury boutiques, through the Wing Lei Cantonese restaurant with its giant crystal dragon, across the crowded casino floor, to arrive at last at a special elevator, which whisked us to one of the lavish VIP suites where high-rollers from China came to indulge their passion for the game of Bacarrat. There my guide, a teetotaling Catholic who had risen up the ranks of Wynn’s operations in Las Vegas from blackjack dealer to floor manager to executive vice president for international marketing, offered to teach me how to play Baccarat on the condition that I swear to never forget the game’s first rule: The house always wins.
That rule has certainly held true for Wynn’s operations in Macau–at least until the last two years. In 2001, Wynn Resorts was among the first gaming companies granted a gambling concession in Macau after the former Portuguese colony’s communist overseers in Beijing decided to the end the two-decade monopoly of local tycoon Stanley Ho. As mainland gamblers flooded in, the tiny enclave boomed. By 2014, Macau’s gaming industry took in seven times the revenue of the entire Las Vegas strip.
On Monday, Wynn will throw open the doors to a second Macau resort, the $4.2 billion Wynn Palace. By all accounts, it will be the most expensive casino in the city. But Wynn’s prospects in 2016 are less certain than a decade ago. Macau’s gambling industry has been hit by a triple whammy of a slowing Chinese economy, Xi Jinping’s crackdown on corruption and a broader effort to transform Macau from high-roller haven to mass-market tourism destination. The Financial Times reports that gross gaming revenue fell 34% last year to $29 billion, and the Macau government forecasts a further decline of 13% this year to $25 billion.