Hot Property… Right Place, Right Time!

Macau’s economy continues to scale new heights at a rapid rate. I was rather taken aback (to put it mildly!) to learn that the region’s per capita GDP is now the highest in Asia. According to the Macau Statistics and Census Service, the region’s per capita GDP jumped 26% to US$36,357 last year. How did this seemingly unassuming Portuguese colony suddenly overtake Japan, Singapore, and Hong Kong?? Macau’s claim to fame is its booming gaming industry.

The flourishing economy and the growing casino industry are the most significant factors behind the escalation in property development in key locations. Currently, Macau is facing a surge in demand for high quality residential apartments. A classic example is that of One Central.

One Central brings together top-notch realtors, Hongkong Land Ltd and Shun Tak Holdings Ltd. Situated at a prime spot between MGM Macao and the newly opened Wynn casino, One Central is scheduled for completion next year. Last year, the development’s 7 luxury residential towers were sold out within the bat of an eyelid following the announcement of their availability. Tower 6 was purchased by Sniper Capital for US$86.6 million. The fund has more recently acquired another 24 residential units in One Central for US$48 million.

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This investment is in-line with Sniper Capital’s strategy of acquiring and developing smaller properties that are strategically located. The investment made by Sniper Capital, through the Macau Property Opportunities Fund, is sure to yield good returns. This is because the demand for residential units in key locations is likely to remain strong. Macau is developing rapidly and the thriving casino and tourism industries would keep pushing up commercial and residential property prices for some time to come. To put it in the words of Tom Ashworth, portfolio manager of the Macau Property Opportunities Fund, “There is no doubting the long-term prospects for Macao growth. This is a long-term story. This is not a five-year story. This is a 20-year-plus story, just like Vegas has grown for something like four decades.”