In Macau, just like in Las Vegas, casinos are competitors and allies. Each wants to take visitors and gambling revenue from the others, but without a critical mass and multiple entertainment options, none would thrive. That's why Macau's Cotai Strip will only get stronger as more casinos are developed on the patch of reclaimed land.

The Cotai Strip is relatively young, with Las Vegas Sands (NYSE: LVS) and Melco Crown (Nasdaq: MPEL) helping each other attract customers to the area. It will remain a two-horse race until Wynn Resorts (Nasdaq: WYNN) and MGM Resorts (NYSE: MGM) open their Cotai casinos in four or five years. In the meantime, Sands Macau is set to open another complex late this year or in early 2012, and the gambling hot spot should shine even brighter.

Looking at the details for Las Vegas Sands' sites 5 & 6 development just south of Melco Crown's City of Dreams, I started to wonder who would actually benefit from the development more? It may not be the new hotel, but the casinos to which it is adjacent. The hotel rooms at sites 5 & 6 will be the dominant feature, not the gaming space like it is at other hotels. By itself, Las Vegas Sands' Venetian Macau has nearly twice the gaming space and half as many hotel rooms as sites 5 & 6. City of Dreams has relatively few hotel rooms, but will benefit from the increased foot traffic on the gaming floor as the table below shows.





Venetian Macau




Four Seasons Macau




Sites 5 & 6




City of Dreams




Venetian Macau has 550,000 square feet of gaming space; sites 5 & 6 will have 300,000 square feet of gaming space.

Don't expect sites 5 & 6 to be the cash cow that The Venetian Macau is. The development will help Las Vegas Sands on the Cotai Strip, but it will be The Venetian Macau and City of Dreams that will benefit the most. And they don't have to outlay any cash to have more customers just a block away. Sounds like a good deal to me.

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Fool contributor Travis Hoium is short put options on Melco Crown. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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