Woolf sets sights on Taiwan island casino

Jul 30, 2002 9:43 AM

Casino entrepreneur Larry Woolf, teaming up with two British developers, appears to have the inside track on a seaside gaming venture off Taiwan.

Woolf’s group has quietly assembled 27 acres on the Penghu Islands, located between Taiwan and mainland China. Their move is timely because residents of the tiny isles last month voted 78-22 percent in favor of opening casinos there.

"It’s very likely to happen soon,’’ the former Caesars and MGM exec said of Penghu gaming. Though the island’s referendum was only advisory, Taiwan’s legislature recently approved a nationwide lottery and Penghu lawmakers are pushing hard for Las Vegas-style casinos as a way to kickstart a slumping economy.

"The idea is to make (Penghu) a gateway to mainland China,’’ says Carlton Geer, director of CB Richard Ellis’ Global Gaming Group. "Right now the only way to go between Taiwan and China is through Hong Kong."

Penghu, population 100,000, already boasts an international airport. The 27 acres acquired by U.K. developers Ian Irvan and Tim Potter sit on a picturesque part of the Taiwan Strait that could evolve into a magnet for tourists.

Sheldon Adelson, MGM Mirage and Australian high-roller Kerry Packer have all expressed interest in Penghu. Adelson already has a beachhead in Macau, where he was awarded one of three casino licenses recently.

But realty experts say that assembling land in the largely agricultural Taiwanese province is no mean feat. Woolf’s team, for example, had to work through 230 land owners and three years of negotiations to put together its 27-acre parcel.

"We’ve got a two- to three-year head start,’’ Woolf told GamingToday.

Meantime, another Nevada player, the law firm of Lionel Sawyer and Collins, has submitted proposed regulations for Penghu gaming. A New Jersey firm, Spectrum Gaming, has also drafted Atlantic City-style rules for government consideration.

Taiwanese officials are moving cautiously, while monitoring progress in Macau. "There’s a fear of corruption versus a cultural bias in favor of gaming,’’ Geer explains. "Ultimately, they hope to have their cake and eat it too with tourism that’s regulated and taxed. If Macau straightens out, we’ll see tremendous growth throughout Asia.’’

Currently, casinos operate legally in Korea, Cambodia and Macau. Race tracks and sports betting are prevalent in Japan, and Tokyo Gov. Shintaro Ishihara hopes to win approval for plans to develop casinos in his city. Industry analysts say the potential for expansion is almost unlimited as gamers eye the huge market in mainland China.

"(Gaming) would definitely bring good fortune to Penghu residents if we look at the issue from a business point of view,’’ Penghu lawmaker Lin Pin-kun told the Taipei Times last month. The governor of the island is so pro-gaming that he even has a picture of Adelson on his office wall.

Woolf’s group, which has met with the governor, is proposing a 10 percent tax on Penghu casino revenues (vs. 37 percent in Macau). And he sees the island ripe for action.

"They’ve already got 7-Elevens and McDonald’s. It’s 40 minutes from south Taiwan by ferry. Whether it’s done locally or through the national legislature, gaming will happen,’’ he predicts.