The government of Malaysia is in talks with gaming giant Genting to develop a casino in Forest City, an ambitious US$100 billion residential development in Johor that Bloomberg has called a potential white elephant.
Sources told the news outlet that Malaysian Prime Minister Anwar Ibrahim met this month with Vincent Tan, founder of resort developer Berjaya Corp., and Lim Kok Thay, chairman of Genting, to discuss the possibilities of an integrated resort in the vicinity.
According to the Straits Times, an integrated resort (IR) with gaming reportedly is among several proposals to anchor the Johor-Singapore Special Economic Zone (SEZ), a planned commercial and investment sector designed to “ease movement of goods and people between the two countries” and boost the local economy.
“They talked,” a source told the newspaper, “but nothing has been formalized.”
According to the Singapore Business Times, however, the prime minister has denied that talks are underway, saying, “The casino… not true, it’s a lie.”
An unnamed official source said the parties involved want to “float the balloon to see what the reaction is” before going public with a proposal. He added that “gaming is one of the key sectors to be promoted under the SEZ for Forest City.”
Forest City, a massive housing community in Johor’s Iskandar region, opened in 2016 as part of China’s Belt and Road initiative, but has failed to live up to expectations.
Though the Johor state government claims that 70 percent of units in Forest City have been sold, last December, a former resident told BBC News that the place was a “ghost town” that he had to escape. “I didn’t care about my deposit, I didn’t care about the money, I just had to get out.” He called it “lonely … just you and your thoughts.”
A Johor business owner told the Straits Times that a casino in the region “would have major spillover effects as high-value individuals would make footfall here and boost other commercial sectors.”
If built, the property would compete directly with Genting’s Resort World Sentosa (RWS) and Sands China’s Marina Bay Sands (MBS), both in Singapore, less than two hours away by car.
But analysts don’t consider a Johor casino much of a threat. In a note to clients, Asian brokerage UOB Kay Hian said “Genting Singapore has a different landscape and customer profile” and “cannibalization from a potential Forest City casino will eventually be digested.”
It added that multibillion-dollar expansions planned for RWS as well as MBS would continue to drive the lion’s share of international and premium visitation, making Johor less competitive.
Meanwhile, a second casino in Malaysia may be a hard sell, as Islam forbids gambling and prohibits its followers from entering casinos.
