Melco Resorts Chairman and CEO Lawrence Ho says he will leave no stone unturned in his quest to win one of three integrated resort licenses in Japan.
Ho’s company is just one in a long list of global firms expected to bid on a Japan license, including the Las Vegas Sands Corp., Galaxy Entertainment Group, MGM Resorts International, Wynn Resorts, Caesars Entertainment, Hard Rock International and others, many of which already have opened offices in Japan.
In terms of finding a local partner—seen as a prerequisite to a winning bid—Ho told Bloomberg News that he is “talking to everyone, because ultimately we just want to be part of a winning consortium and we’re very open-minded.
“Given the sheer magnitude of these projects,” Ho said, “it’s very important to get buy-in from the chambers of commerce, associations, SMEs and the local communities.” He said he wants to build “the most awesome thing ever, I want to go wild in building this.” His short list of development sites includes Yokohama and Osaka. “Those are our prime candidates, those cities,” because of their “great infrastructure, close access to an international airport and … tourism appeal.”
As Gaming Today reports, “There’s a heck of a horse race brewing.” The publication called out Melco and the Las Vegas Sands Corp. as front-runners in the race. Sheldon Adelson, Sands chairman and CEO, agrees with at least part of that assertion. “Everybody, local Japanese, business people, banks, say we have the leading position because of my background,” said Adelson during the company’s second-quarter earnings call.
“I used to produce the Comdex show in Japan, and I also helped them to redesign the biggest exhibition center they have in Japan, called Makuhari Messe. I’ve got a reputation in Japan of being the leading MICE integrated resort developer and operator. People who know say that we’re in the number one pole position.”
“We’ve had a presence there for over a decade and we’re eager to be there,” added Sands President Robert Goldstein. “Our plan is simple. We have the balance sheet. We have the reference point IRs in both Macau and Singapore that the Japanese government look to.”
Hong Kong-listed Galaxy Entertainment Group is demonstrating its good neighbor policy with a program to educate Japanese students to IR management. The pilot will be developed through the nonprofit GEG Foundation with the help of the University of Macau, according to Asia Gaming Brief.
Cambodian casino operator NagaCorp may also get in the running. Chairman Tim McNally has called Japan “undoubtedly an attractive market.”
Jim Murren, chairman and CEO of MGM Resorts International, recently told the Sankei Shinbun that Osaka is perfect because of its transportation infrastructure. “Kansai International Airport and Kobe Airport are nearby, and the Shinkansen and local railway network is developing.” He said MGM may invest up to US$9 billion in an integrated resort in Japan.
AGB Executive Editor Michael Penn told Deutsche Welle, “The next phase will be local authorities selecting consortium partners, then the government selecting the best three locations from the bidders.
“The government’s prime motivation is the extra money that these facilities will bring in, although they have been careful to headline the drive to attract more foreign tourists, to develop new five-star hotels, to help the construction sector and to create new employment opportunities, particularly in areas of the country that are seeing young people leave for jobs in the big cities,” he added.
But a Kyodo News poll conducted after the legislation passed showed that 64.8 percent of Japanese surveyed remain opposed to casinos. Professor Teruo Sakurada of Hannan University in Osaka, who is also chairman of the Stop Casino Osaka Citizens’ Network, said, “The law is simply very bad. The government tells us that it will have a positive economic impact on the whole nation. My research shows that the government will earn a lot from taxes and the operators will bring in a huge amount, but ordinary people, those in society who can least afford it, will be out of pocket.”
The pachinko industry also is no fan of integrated resorts. The Japan Times reports that new rules aimed at curbing gambling addiction will also affect the entrenched gaming parlors, which must reduce payouts over the next three years.
“If you restrict the excitement so much, people will quit,” said Naomi Suzuki, owner of a pachinko parlor in Japan. “The point of allowing casinos was to bolster regional finances. But the pachinko industry will be taking the hit.”
