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Site Selection

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Submitted By fionahomanfa
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Site Selection:
The location of a casino is an important decision, because this raises strategic, regional and local considerations (Hannigan, 2007). A framework of site selection criteria, therefore, should work out to determine the casino location.

Selection Criteria:

The locational determinants are documented as followings to determined our casino development location: (Rephann, 1997) 1. Proximity to larger urban areas 2. Quality of transportation infrastructure: 3. Restrictiveness of state casino gaming regulations 4. Proximity to non-casino-gaming states 5. Scale of casino development 6. Presence of other recreational attractions 7. Qualified Personnel inputs

In addition, other aspect of the potential destinations such as the reputation of the destination, the economic development situation, the potential tourism development opportunities, accessibility problem in VISA restrictions and the risk analysis of the destinations will be taken into consideration.

Attracting elements in choosing Singapore:
After conducting the site selection analysis, it is found that Singapore could be one of the potential destinations to be developed for a new casino. General speaking, the high revenue generated by tourism, the high proportion of people in the highest socio-economic categories, the presence of Singapore’s iconic attractions, the high concentration of hotels and so on making Singapore being a higher potential for the new casino development.

a) Prosperous Singapore Economic situation:
Singapore is a prosperous city with a high living standard proving that it has a sound economic system. It is said that world’s highest millionaire households are in Singapore. It is regarded as one of the best investment destinations across Asia for foreign firms. According to the Business Environment Risk Intelligence (BERI) report (2011) Singapore has been placed first among the countries with best investment potential, it's one of the top two most competitive countries, it is ranked 1st in Asia as the least economically corrupted country.

It is believed that persons with a higher qualification and a high salary are most likely to visit casinos (Ishizaka, 2011). Besides, according to Minnesota (1992) that gamblers are drawn mostly from within the state. Therefore, with a flourishing economy, it is beneficial to the development of a new casino as the locals may have stable financial status to play in casino so as to support the casino operation.

b) Good Reputation and better tourism performance of Singapore:
Singapore has a good reputation in terms of tourism development. It is awarded as one of the most popular travel destination. It is ranked 10th as the “Most Popular Travel Destinations for 2010” by HotelsCombined.com and ranked 20th as the “Newsweek World’s Best Countries Survey 2010” in overall tourism performance.

A good reputation can increase tourists’ interest to visit Singapore results in a flush in of visitors generating higher potential tourism revenue. Singapore, being an excellent tourist destination of the world, attracts numerous tourists from almost all corners of the world. As per 2011 statistics, around 11.6 million people come to Singapore annually generating around 3 billion USD which indicated a higher potential in gambling.

Singapore is also regarded as the second largest market for casino gambling since the two casino resorts namely Marina Bay Sands and World Sentosa Casino Resorts are operated in 2010. It helped attract visitors and lured gamblers, particularly from neighboring Asian countries. For example, the arrivals from China surged 35% in 2011 and tourism industry revenue jumped 17% to a record SG$22.2 billion. The revenue from sightseeing and entertainment, which including gambling soared 37% to SG$5.5 billion (Tourism Board, 2011).

The successful of the development of the 2 casino resort in Singapore provides a solid foundation for the future casino development. The rich experience in casino operating and the good tourism destination reputation contributing Singapore to be the potential destination.

Proposed Location in Singapore—Dempsey Road:

The proposed location of a new casino is at the Dempsey Road near the district of Botanic Garden in Singapore, where a large abandoned area is found which is suitable for developing a new casino. Located in the same vicinity is Dempsey Hill and Dempsey Hill Green, which was previously the Civil Service Club.

It is one of the hotspot that tourists should visit when they are travelling to Singapore. It is a huge hub of restaurants, pubs and retail stores. This place is rife with around 30 food joints, 2 spas, 1 special entertainment center for kids and over 25 retail stores catering various kinds of goods
Planning to build a new casino here could be easier as they are not many residents that resulting in a less objection from local communities. There are many extra casino entertainment opportunities accommodated the needs of gamblers and non-gamblers.

Further analysis on choosing Singapore and the site in Demspey Road will be conducted later.

Application of criteria of Rephann to Singapore:
The criteria suggested by Rephann (1997) will be applied to analyze the suitability and feasibility of Singapore to be chosen as the casino development destination.

1. Proximity to larger urban areas:
Communities in close proximity to larger urban areas are more accessible to potential tourists meaning that closer proximity to larger urban markets result in greater impacts in being chosen as a destination for developing a new casino (Rephann, 1997).

The major towns and cities of Singapore are Singapore, Jurong West, Kallang, Orchard, Ang Mo Kio, Punggol, Lim Chu Kang, Mandai, Changi, Bishan, Tuas, Clementi, Tampines, Marina Bay and Sentosa.

Singapore is the capital city. The Orchard Road district, which is dominated by multi-story shopping centers and hotels, can be considered the center of tourism in Singapore. The Marina Bay and Sentosa Island with the integrated casino resorts are being more popular tourists’ attractions.

When considering the proximity of Dempsey Road to the urban area and the major cities, it could be a potential location due to the short distance in between to be a convenient location.

The distance between Demspey and Singapore, the capital is around 10km. It is only 3 km to Orchard Road District. It is near the 2 integrated casino resorts in Marina Bay and Sentosa Island, which are 12km and 11km respectively. To the airport which is being claimed as the farthest, still got only 26km. It is obvious that Demspey has a closer proximity to the larger urban cities generating a larger impact to be the new casino location.

2. Quality of transportation infrastructure:
Regions with good transportation infrastructure are more attractive as more accessible by potential tourists meaning that the location with better connectivity infrastructure in terms of roads, rail, and airport will be chosen.
Singapore’s best connected location through road, rail and underground and therefore has significant visitor and casino development potential (Rephann, 1997).

In terms of Singapore transportation network, it is highly organized and efficiently managed. Most places of Singapore, including the islands of Sentosa is accessible by roads.
All the places can be covered by the available modes of public transportations including Mass Rapid Transit (MRT) which is the most convenient mode of transport in Singapore. Besides, bus, taxi, private car services, airport and SMRT shuttle service are also available. In addition, most of the places can be visited by walking. There are various modes of transportation that suit the budget of all people providing a lot of choices.
Besides, Singapore is one of the best connected cities from world’s major Metropolises through its airports. Changi Airport has emerged as a major aviation hub in the entire Asia Pacific region. Being the winner of more than 250 awards, it is regarded as one amongst the best airports in the world. It awarded as the “Best Airport in the World, Business Traveller Asia-Pacific Travel Awards 2010”, “Asia’s Leading Airport, World Travel Awards 2010” and “World’s Leading Airport, World Travel Awards 2010”

There are many international flight operators currently operating including Air Canada, Air France, Malaysia Airline, Singapore Airlines and Virgin Atlantic Airways. The airport operates about 80 airlines that serve more than 180 cities in more than 50 countries worldwide including London, Tokyo, Hong Kong, New York and Paris etc. with the availability of both economy and executive class flights.

As considering to the site location, there is a well-developed transportation network in Dempsey Road. It takes only 26minutes to the airport by Central Expressway (CTE), Pan Island Expressway (PIE) and East Coast Expressway (ECP).

To the surrounding tourists’ attractions and the urban areas, it takes around 15 to 20 minutes to Singapore, Orchard, Changi, Marina Bay and Sentosa Island by different mode of transportation.

The comprehensive transportation network in Singapore and also in Dempsey Road contributed to the selection of the location.

The followings show the mode of transportation, the distance and the time from Demspey to Changi Airport.

1. CTE and PIE: 24.6 km and 26mins

2. PIE: 26km and 24mins

3. ECP:29.4km and 26mins
3. Restrictiveness of state casino gaming regulations:
Some state laws restricting casino operations can have a detrimental effect on the competitiveness of state casinos. It restricts wagers to small amounts aims to reduce some of the social externalities such as crime and compulsive gambling. However, these restrictions can make the sites less attractive for all types of potential gambler. Therefore, region with looser casino gaming regulations is associated with larger impacts in developing casino industry(Rephann, 1997).

Casino gaming is legalized in Singapore but with some restrictions on locals. The government has sought to keep Singaporeans out of the casinos, imposing a SG$100 entry fee on citizens.

Besides, the new Casino Control Act is designed to minimize criminal activities potential negative consequences associated by gaming. With the introduction of new casino gambling laws, gambling contracts made in casinos are now enforceable in the courts. Similarly, credit that is extended to patrons for gaming by the casino operators and promoters of licensed excursions to casinos is also enforceable.

The Casino Regulatory Authority has been established, with both investigative and enforcement powers, to investigate a casino operator’s background, accounts and business links. These investigations are very thorough, and can involve key directors and management.

Besides, Singapore adopted the policy of ‘Compliance first, commerce later’, which works well policy in Nevada Gaming Control Board.

It seems that there are lots of casino restrictions in Singapore which may discourage the development of casino industry. However, there are no restrictions on tourists. When comparing to those countries which are strictly restricted gambling, Singapore still have its attractive factor to be developed as a new casino hub.

4. Proximity to non-casino-gaming states
Regions with closer proximity to restrictive states of gaming are associated with larger impacts in developing casino (Rephann, 1997).

Singapore is near to some non-gambling states in Southeast Asia such as Indonesia, Thailand, China, Laos, Malaysia and Vietnam as shown followings.

The illegal gambling or strict control in casino in those areas results in a higher potential to generate gamblers to Singapore as it is convenient to Singapore with the better connectivity of transportation system.

Gambling is strictly illegal in Indonesia, but there are 13 large illegal gambling tens operated in Jakarta implying that illegal gambling in popular in Indonesia. With legalized gambling in Singapore have a possibility to attract those gamblers in Indonesia. Besides, it only takes 1 hour and 40 minutes from Jakarta to Singapore. It is very convenient.

There is only 1 casino in Malaysia is legal targeting Singapore, Thailand and Indonesia markets with the second highest gaming tax rate 25% in Asia attracted 20 million visitors in 2008. With the legalized gambling in Singapore, it is said that there is a higher potential to attract back the Singaporean and Malaysian to play in the new casinos. Besides, it only takes 55 minutes from Malaysia to Singapore. The shortest distance can attract more gamblers.

Similarly to Thailand and China, gambling is illegal. With the legalized of casino in Singapore, it is believed able to attract more gamblers and non-gamblers from these countries. As according to the Singapore Tourism Board (2011), about 80% of visitors to Singapore last year came from Asia, led by Indonesia and followed by China, Malaysia, Australia, India and Thailand. The newly developed casino can be served as the new attraction to those non-gambling states and the top tourism markets in Singapore.

Therefore, Singapore is a good destination to develop a new casino as it has a higher potential to draw gamblers from the non-gambling states nearby.

5. Presence of other recreational attractions
A large and diverse recreational sector contributes to larger impacts. Because of recreational service complementarities, communities that have existing recreational endowments can market these attractions in combination with casino gaming to increase their market (Rephann, 1997).

The number of tourist gamblers may be very high, especially in synergistic tourist destinations, characterized by the presence of multiple casinos, thousands of hotels, high quality restaurants, nightclubs and recreational activities such as spas, shopping areas, theatres ((Ishizaka, Nemery and Lidouh, 2011).).

Recent researches tend to show that tourism gambling is often only a secondary activity. For example, in Las Vegas, almost 100% of the gamblers were tourists in 2009. However, the first purpose of their visit was for vacation in 40% of the cases. In Laughlin, 99% of the gamblers were tourists in 2009, but only 20% were tourists’ gamblers, whilst in 48% of the cases the first purpose of their visit was for vacation (Ishizaka, Nemery and Lidouh, 2011). From these researches, it shows the importance of extra casino entertainments.

Singapore provides ample ways for people to amuse and entertain themselves. For the attractions, it has an exciting development in 2010 with the opening of new tourism products including the Universal Studios Singapore, the world famous theme park and the Sands SkyPark. Existing attractions like the Singapore Cable Car, Skyline Luge Sentosa were re-launched, rekindling public interest. Riverside is dotted with museums, theaters and multiplexes.

For shopping activities, there are places for ethnic shopping like Chinatown and Little India. Mustafa Shopping Centre is open 24-hours. Orchard Road has miles of pedestrian shopping complexes.

For hotel accommodation, the total hotel room inventory is at over 47,000. The Orchard road has more than 30 hotels, ranging from boutique to full-service hotels offering quality experiences for tourists’ gamblers.

For Dining experience, Singapore is an acclaimed global culinary capital and its restaurants are placed among international and regional rankings, including “The Miele Guide’s Asia’s Top 20 in 2010-2011” and “San Pellegrino World’s Best Restaurants Top 100 ranking 2011”.

For special sport events, Singapore with many high profiles international sporting event such as the FORMULA ONE™ night race and the inaugural Youth Olympic Games showcasing the country’s ability to have fun and relax.

The Demspey Road itself is also an entertainment hub and tourists hot spot as mentioned before. Therefore, the excessive entertainment opportunities in Singapore make attractive to build a new casino.

6. Scale of casino development
It is measured by square footage of gambling area, larger casinos add to larger effects (Rephann, 1997)

The casino should be in a large scale to contain different types of games, sufficient number of game tables, wide variety of dining opportunities and entertainment opportunities if possible to cater the needs of non-gamblers who are coming with the gamblers. Local gamblers prefer video poker games, whilst tourists’ gamblers play mostly with slots.
.
In Singapore, Marina Bay Sands and World Sentosa Resort are two integrated resorts with 2 large scale house casinos, operating in a great success. With a larger casino area, different gaming table and different types of gaming machines can be put in to accommodate different types of gamblers. Together with rich entertainment opportunities made the success. To copy from them, a large scale casino should be developed.

Dempsey Road which has a large abandoned area, it is large enough to construct a new casino containing more than 200 game tables.

The suitability to develop a larger casino made Demspey in Singapore being chosen as a new development site.

7. Qualified Personnel inputs
Areas that provide other needed service sector inputs competitively, such as skilled labor, low-paid labor, good public services, amenities, etc. are more promising candidates for casino investment. Therefore, higher quality labor resources and lower wages contribute to higher effects (Rephann, 1997)

Even some communities may succeed in attracting substantial development may fail to realize all of the benefits because local labor markets are unable to supply the new industry with the trained professionals it needs.

However, there are many qualified personnel in Singapore, providing sufficient labor supply in a professional manner. Singapore enjoys one of the highest literacy rates in the world. The education system of Singapore has evolved over the years to match the international demand for skilled workers for economic development.

With sufficient qualified personnel and rich experience in operating large casino in Singapore, it is easier to locate and determine management team of casino operation. Therefore, Singapore is a fine location to develop a new casino.

To conclude, by applying the criteria specified, Singapore seems meet all the criteria so that it will be elected as the proposed new casino location.

Reference: 1. Singapore Tourism Board Annual Report 2010/2011 (2012). Retrieved November 30, 2012 from, Singapore Tourism Board Web site: http://www1.yoursingapore.com/annualreport/pdf/STB_AR_2011_PDF.pdf

2. Statistic Singapore Key Annual Indicator (2012). Retrieved November 30, 2012 from Singapore Government, Department of Statistic Web site: http://www.singstat.gov.sg/stats/keyind.html#litedu

3. Hot Spots in Singapore (2012). Retrieved November 30, 2012 from, Web site: http://www.focussingapore.com/singapore-entertainment/hot-spots.html

4. Zuji Hong Kong (2012). Retrieved November 30, 2012 from, Web site: http://www.zuji.com.hk/

5. Rephann, T. J., Dalton, M. & Isserman, A. (1997). Casino Gambling as an Economic Development Strategy . Tourism Economics, 3 (2), 161-183.

6. Tay, R. K., & (2009). New Developments in Casino Gaming Business: Singapore’s Approach to Responsible Gambling. Business Law Review, 118-121.

7. Casinos behind record number of visitors to Singapore: official. (2012, February 8). The China Post

8. Ishizaka, A., Nemery, P. & Lidouh, K. (2013). Location selection for the construction of a casino in the Greater London region: A triple multi-criteria approach . Tourism Management, 34 211-220.

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