(Adds quotes from Las Vegas Sands)
By Dominic Whiting
HONG KONG, Nov 13 (Reuters) - When multi-billionaire Sheldon Adelson unveiled a gleaming model of casinos and plush hotels in a dimmed Macau room nearly four years ago, he promised a $15 billion Asian "neon alley" to rival Las Vegas.
But the vision Adelson said came to him in a dream could remain largely idle reclaimed land for a few years longer as the financial crisis and slowing gaming revenue puts him billions of dollars short of the funding he needs to complete the project.
Left in the dust of Macau's Cotai Strip are the hopes of some of the world's biggest hotel chains, such as Starwood Hotels and Intercontinental Hotels, which imagined a bustling centre of fun and conferences.
"It's all doom and gloom," said a construction executive at a rival casino project in Macau, who asked not to be identified in making comments about a competitor.
"There are going to be some mass cullings on building sites."
Hampered by steep construction costs, frustrated by Chinese visa restrictions and squeezed by tour operators asking high commissions to ship in gamblers, Macau casinos have had a tough time in the last year.
Now Adelson's Las Vegas Sands is struggling to fund projects because falling revenue from Las Vegas means it risks breaching U.S. loan covenants, which tie debt levels to earnings. Banks could demand early repayment.
The firm, stretched by a casino project in Singapore, suspended construction on its Macau expansion and said on Thursday it was laying off most of the 11,000 construction workers on the projects.
It also said it was in talks with a syndicate of banks to raise between $1.5 billion and $2 billion in project finance but gave no timetable.
"We would not have suspended if we could see clarity on how long it would take to raise the funds," Stephen Weaver, the firm's Asia president, told reporters at the Venetian Macao.
The loans come on top of some $2.1 billion in fresh equity raised by Las Vegas Sands this week, of which about half will come from Adelson. The other half will from a public share offering priced on Tuesday at $5.50 each for shares that were trading at $122 in December. The stock slide meant Adelson, the son of a taxi driver, lost $4 billion of wealth in September, Forbes says.
"The plan to develop the Cotai Strip in three years time was overly aggressive," said Credit Suisse analyst Gabriel Chan. "But it's not a demand problem, more a financing problem."
Macau is forecast to notch up nearly $14 billion in gaming revenue this year, a gain by nearly a third on 2007, despite a recent slowdown as China cut back on visa approvals.
Beijing has become nervous about the territory's impact on society and its use by corrupt officials to launder money, analysts say.
DREAM BIG
Adelson was encouraged to dream big by a 2002 move to end a four-decade casino monopoly held by tycoon Stanley Ho and welcome U.S. operators such as Wynn Resorts and MGM
Beijing then eased rules on travel, unleashing a flood of gamblers into the only place in China where casinos are legal.
Hordes thronged Adelson's first casino in the former Portuguese enclave, the Sands, when it flung open its doors in 2004. Last year he opened the world's biggest casino, the Venetian, months after Macau overtook Las Vegas as the most lucrative gaming market.
The plan was to build a huge complex on the Cotai Strip that would draw not just hard-core gamblers but families and the convention crowd, who would shop and watch shows.
But Macau could now fail to reach a critical mass of attractions, with Las Vegas Sands halting construction of an 850,000 sq ft shopping centre and hotels run by the likes of Starwood Hotels, Hilton and Intercontinental.
Many in the industry say Macau needs a breather from frenetic building, with growth in gaming tables likely to drop to 12 percent annually over three years, from the planned 35 percent.
"In any other market people would be cheering this growth, people got spoiled by Macau numbers," said Steve Rosen, senior vice president at Macao Studio City, which has delayed building a casino, retail and film studio because of the credit crunch.
STOMACH ACHE
While all casinos are keen for Macau to draw the masses, some could enjoy the respite from a pause by Las Vegas Sands.
Adelson's arch nemesis, Steve Wynn, has opened one casino in Macau but held off on building on its land on the Cotai Strip. And Melco PBL, a joint venture by the sons of Australian tycoon Kerry Packer and Stanley Ho, has the funding in place to finish its City of Dreams casino next year.
But Galaxy Entertainment Group could find it tough to get the funding to finish its Cotai Mega Resort, analysts say.
"Those who have the money to complete projects next year will be the big winners," Credit Suisse's Chan said. "The City of Dreams might be the only opening on Cotai in 2009."
The finished Cotai Strip could be put off for as long as seven years, Chan said. But few in the industry doubt Adelson, now aged 75, is determined to make his dream reality, even if he needs to spend more of his own money.
"He's got the vision, he believes in it," said Rosen.
"And five years down the road people will look at the Cotai Strip say it was a visionary project," he added.
"This is a hiccup, a major one. Actually, it's more like a stomach ache." (Editing by Jerry Norton and Lincoln Feast)