Opportunities grow for non-gaming income as casino-resorts, including projects in Asia Pacific, welcome next-gen guests.
INTERNATIONAL REPORT – Hotel-focused architecture firm WATG
is venturing deeper into casino resorts as non-gaming revenue rises, driven by
a new set of millennial travelers.
WATG CEO David Moore sees massive opportunities for investors to create diverse
innovative concepts – be it in rooms, restaurants, bars, entertainment or
retail – that will hit the jackpot with casinos’ next-gen guests and keep the
cash register ringing.
The company has just acquired SOSH Architects in Atlantic City, which is known
for its expertise in casino and hotel design. While strengthening its presence
in the sector in the U.S., WATG is also eyeing the Middle East and Asia, where
more casino resorts are set to open.
In the UAE, Abu Dhabi and Ras Al Khaimah are reportedly pushing ahead to open
these attractions. In Asia, Sri Lanka’s City of Dreams in Colombo is already
operating and is scheduled for full completion in mid-2025. Thailand is still
in talks to advance a “casino-entertainment complex,” while Japan's first
casino resort is likely to open in Osaka in late 2030.
But over the past several years, the revenue pattern of casino resorts has
shifted. In Nevada, the cradle of hotel casinos, gaming revenue fell from 62%
to 44% (as of 2023), while non-gaming revenue rose, according to UNLV Center
for Gaming Research. The Las Vegas Strip resorts saw the most dramatic drop in
gaming win from 59% of total revenue to 35%. Other income, such as high-ticket
entertainment and retail, more than doubled, the research showed.
Non-gaming attractions are important to attract a broader range of guests, especially if the domestic market is either restricted from gaming or is not expected to drive gaming revenues for cultural reasons.
David Moore
In Asia, gaming is still the bulk of revenue but there is strong government
push towards more non-gaming, including in countries such as Singapore, Macau,
Japan and those in the UAE
“Non-gaming attractions are important to attract a broader range of guests,
especially if the domestic market is either restricted from gaming or is not
expected to drive gaming revenues for cultural reasons,” Moore said.
Japan’s regulations limit casino gaming floors to just 2% of the overall gross
buildable area. WATG’s project at Paradise City in Incheon, South Korea, a
country with a population of 52 million people, is an example of a
foreigners-only casino using non-gaming attractions to attract locals.
While non-gaming amenities may not match the profitability of gaming, they are
vital to attract and keep gamers within the resort, extend the stay and build
loyalty to the brand, Moore added.
The most profitable non-gaming attractions in Asia's casino resorts is retail,
thanks to the region's strong consumer culture and appetite for luxury, Moore
said. At Marina Bay Sands Singapore, home to flagship stores of Louis Vuitton,
Gucci, Chanel and such, retail contributes 7% of total revenue, with sales
averaging $110 per square foot, according to WATG.
On the ‘same-ness’ of retail whether it's at Wynn Las Vegas, Marina Bay Sands
or Galaxy Macau, Moore observed Asian projects are innovating the retail space.
South Korea's Jeju Dream Tower, for instance, integrates high-end global brands
with unique local names of more than 300 Korean designers. This balances luxury
with local identity, broadening the appeal for global travelers and those
looking to explore Korea's dynamic fashion scene, Moore said.
In recent years, Asia’s casino resorts have also embraced experiential,
entertainment-driven retail, incorporating live performances, augmented reality
displays, and curated pop-ups that blend fashion, technology and culture, all
of which resonates with younger audiences, he added.
Trends to consider
When asked what current trends investors should consider when designing non-gaming
amenities, Moore noted that resorts are leveraging AR, VR and interactive media
to create attractions that transport guests into new dimensions.
Another key trend is “hyper-segmentation,” where guests prefer an experience
tailored for them and their family. “At a project in Asia, we are working on
revisions to the pool deck from a single use space to a myriad of zones and
experiences for different demographics and psychographics. We considered
everything: day to night activations, how to cater to major external events
without impacting overnight guest experience, and even zoning areas to appeal
to different ages of children from 1-3 years, 3-7 years, et cetera,” he said.
Entertainment, meanwhile, is moving beyond traditional private VIP rooms to a
socially-visible environment, which can be achieved by creating tiers of
exclusivity, from private lounges to semi-public premium zones. It drives
incremental revenue by offering elevated dining or experiential packages for
those willing to pay for premium access.
Theme dining and cutting-edge wellness concepts are also reshaping the
non-gaming landscape, Moore said. Dining experiences combine gastronomy with
storytelling such as underwater restaurants, dining in the sky, or meals
accompanied by theatrical performances. Wellness offerings have expanded to
include multi-sensory spa treatments, AI-driven health diagnostics and wellness
retreats tailored to holistic lifestyles.
The opportunities for generating additional non-gaming revenue are “vast and
continually expanding,” Moore said. Think activities such as indoor
rock-climbing walls in retail environments; immersive art exhibitions; VR
gaming zones offering offer more unique, interactive experiences; exclusive
workshops and classes to tap into the growing demand for personal enrichment
and relaxation.
There are challenges however in integrating non-gaming into casino resorts. One
challenge is demonstrating the economic impact of non-gaming attractions.
“These additions often represent significant investments, but a well-rounded
masterplan can showcase their broader impact, such as job creation and regional
economic growth,” Moore said.
Others include aligning non-gaming amenities with the regional market and
visitor demographics, and stakeholder alignment and operational execution. “It
is certainly a challenge to create hyper-personalized luxurious experiences at
scale with key counts of more than 2,000,” Moore added.
A masterplan that includes specific features of the site and its surroundings
to connect the development with its environment is needed. “Without this
integration, the architecture of many casinos risks becoming disconnected,
failing to resonate with guests seeking more than just gaming. Our early
involvement in the planning process is vital. Creating schematic designs that
reflect a vision for an integrated resort allows developers to better navigate
regulatory approvals and align with government entities,” he said.
Lessons from the best
Commenting on who got it right, and who got it wrong, with non-gaming in Asia,
Moore said Marina Bay Sands and Resorts World Sentosa in Singapore have set the
bar.
Non-gaming offerings must be innovative, authentic and aligned with the destination’s brand to stand out.
David Moore
Marina Bay Sands, for example, offers a luxury infinity pool with panoramic
views of the city, while its celebrity-chef restaurants, high-end shopping and
nightclubs appeal to a more socially-engaged type of gamer demographic, he
said. On the other hand, Resorts World Sentosa has capitalized on its
family-friendly appeal, offering attractions like Universal Studios Singapore,
the S.E.A. Aquarium and soon to come Super Nintendo World to attract families
with children. It has further expanded its wellness offerings with luxury spas
and health-focused retreats, providing a balanced, all-encompassing resort
experience.
As for who got it wrong, he said in Macau, many resorts initially tried to
replicate the success of their Las Vegas counterparts by introducing extensive
retail and dining areas. “However, while these resorts did capture significant
foot traffic, the lack of local cultural integration or truly innovative
non-gaming attractions led to diminishing returns.
“Non-gaming offerings must be innovative, authentic and aligned with the
destination’s brand to stand out.”