City of Dreams Mediterranean bumpy start with 181 job losses

City of Dreams Mediterranean bumpy start with 181 job losses

The City of Dreams Mediterranean, the first Integrated Resort in Europe, is grappling with significant challenges just four months after its grand opening. The recent dismissal of 181 employees sheds light on the various issues that have plagued the mega-project since its inception. The construction process of the City of Dreams Mediterranean faced hurdles from the outset, with the onset of the Covid-19 pandemic disrupting timelines. The termination of the passport program, initially supporting the project, added to the woes. The conflicts in Russia’s war in Ukraine, subsequent sanctions, and the recent war in Israel further compounded the challenges, impacting the casino’s ability to attract tourists and leading to a decline in casino traffic.

Company admits necessity of difficult decisions

The decline in casino traffic, attributed to the loss of tourists from key markets like Russia and Israel, has forced the company to make difficult decisions. Reports indicate that operating costs are being restructured to ensure the long-term viability of the project. However, concerns about an unfavourable working climate persist, leading to resignations even from senior positions. SEK and PEO, hotel workers’ guilds, highlight a challenging working environment and call for the intervention of the Minister of Labour. As of now, there has been no official update from the Ministry on the matter.

Lessons learned and future strategies

Reflecting on past mistakes, the City of Dreams Mediterranean acknowledges its struggle to attract the expected clientele four months after inauguration. Initial reliance on affluent customers from Russia and Israel prompted an early marketing adjustment. Melco CEO Lawrence Ho recognises the impact of developments in Israel on the project and emphasises the company’s active efforts to adapt its marketing strategy. Questions linger about the wisdom of relying heavily on one or two markets for a project of such magnitude and whether the company can demonstrate the necessary adaptability.

Lawrence Ho, Melco CEO.

The challenges faced by the casino-resort were further highlighted when SiGMA held its SiGMA CIS/Balkans event at the venue in September. Unfortunately, the experience did not live up to 5-star expectations, adding to the already bumpy journey for City of Dreams Mediterranean.

The project, operational since July 10, initially employed 2000 workers, with an additional 400 hires in subsequent months. Following the recent layoffs, the company’s future course remains uncertain. Exploring opportunities, the prospect of opening up to European markets is being considered, although performance in other Middle Eastern countries reveals significant challenges in meeting investment targets.

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