The closures mark the end of a regulatory transition that began in 2022, when the new Gaming Law introduced a three-year grace period for satellite casinos — venues owned by third parties operating under the licenses of the concessionaires — to either close down or convert into licensed management companies. With this deadline ending at the close of the year, at least nine of the 11 satellite casinos still operating in the city are expected to cease operations.

António Lobo Vilela, a lawyer specialized in the gaming sector, argues that fears of a destabilizing economic effect from the closures are exaggerated. “Assuming it’s true that the satellite casino segment accounts for about 5 percent of the total gross gaming revenue, and knowing that the gaming tables operated by the satellite casinos will continue to function in casinos directly run by the concessionaires, I don’t believe that the closure will have, or could have, a significant impact on the final gross gaming revenue figures,” says Vilela.

The Chief Executive, Sam Hou Fai, stated at a press conference that satellite casinos contributed just over 10 billion patacas to the gross gaming revenue of over 200 billion patacas in 2023 — about 5 percent of the total.

For Vilela, Macau’s limited hotel supply will continue to ensure high demand for these hotels, and with that, the wide array of associated businesses will continue to benefit. “There will probably no longer be room for pawnshops — but that doesn’t seem to be problematic.”

“The hotels where satellite casinos operated will not close their doors — just as those housing satellite casinos that shut down in 2022 didn’t close,” he states.

Impact on the “local economy”

Ricardo Siu, Associate Professor of Business Economics at the University of Macau, agrees that the closures’ impact on overall gross gaming revenue will be limited. “Although there will be a negative impact, it should be acceptable,” he says. “According to the MSAR Government, the impact of the closure of the 11 satellite casinos on gross gaming revenue should be in the ‘low single-digit percentage.’ I would say that means something below 5 or 4 percent.”

While the financial performance of the industry as a whole is expected to remain stable, the impact on local economies remains more uncertain. “It is reasonable to expect that the flow of consumers and the absolute value of spending in these areas will slow down,” warned Siu, referring to neighborhoods such as NAPE and ZAPE. “The vitality of businesses and employment opportunities in these areas will be negatively affected,” he explains.

The real estate consultancy Jones Lang LaSalle (JLL), for example, predicts that the value of commercial properties in ZAPE and NAPE — where several satellite casinos are located — could drop by up to 40 percent after these venues close at the end of the year.

According to government estimates, about 320 businesses operate in the vicinity of satellite casinos, with approximately half expected to be “directly” affected by the closures. These include pawnshops, jewelry and gold shops, telecommunications operators, restaurants, and tobacco and alcohol outlets.

“It is reasonable to expect that the flow of consumers and the absolute value of spending in these areas will slow down,” Siu reiterated.

The government and local business associations have already proposed revitalization plans, such as converting certain areas into pedestrian zones and creating tourism incentives. But Siu warns that the success of these measures is not guaranteed: “The final effect of these initiatives may remain subject to uncertainty.”

Carlos Siu Lam, Associate Professor at the Centre for Gaming and Tourism Studies at the Macao Polytechnic University, also points to the socioeconomic effects of the closures, particularly for older and lower-skilled workers.

“As satellite casino workers are generally older and have somewhat lower knowledge and skills, it may not be easy for them to find jobs in this economic context (…) although the number is not very high, it will have a negative impact on the economy overall.”

Around 5,600 local workers are linked to satellite casino operations, with 4,800 already employed by the concessionaires — SJM, Melco Resorts & Entertainment, and Galaxy Entertainment Group — which have committed to reallocating staff internally. The remaining 800 are directly employed by the operators of the properties where the casinos are located.

“I don’t think the closure of the satellite casinos will have a significant impact on the local economy. The casino employees are, or should be, employees of the concessionaires, who will have to absorb them,” Vilela stresses.