Telsey Advisory Group’s Senior Gaming & Lodging Analyst Chris Jones has issued a report on Japan’s casino potential that forecasts a market considerably smaller than the billion top-end estimate some analysts are projecting.
Jones believes that on the high side the industry could generate $23.8 billion in a year in gaming revenue, based on 0.4 percent of Japan’s GDP, a benchmark of the US market, and about $16.5 billion at the conservative end.
The report expresses concerns about the slow progress the country has made in meeting the government’s tourism goals. Japan has set a target of 18 million visitors in 2016 and 25 million in 2020, but it has yet to accomplish its more short-term goal of attracting 10 million visitors a year. Even the allure of hosting the 2020 Olympics won’t be enough to tilt those numbers in the long term, the report says.
Jones believes the Tokyo area can support two casinos with a $8 billion project generating $5.2 billion in gaming revenue and a somewhat smaller casino across Tokyo Bay in Yokohama generating $4.7 billion.
A $6 billion casino in Osaka could generate $3.8 billion and large regional casinos in Hokkaido and Kyushu could generate $1.8 billion each, he said.
