The government of Japan has announced that it will postpone publication of its Fundamental Policy on Integrated Resorts until after the summer elections, and may not issue the complete rules until next year, according to Inside Asian Gaming.
The government originally said it would publish the policy and establish the Casino Administration Committee this summer. But lawmakers are reportedly concerned that lingering anti-casino sentiment among some voters could affect the poll results. The decision could push back the expected timeline for the first three resorts to open.
The news wasn’t welcomed in Osaka, where officials hoped to open an IR ahead of the 2025 World Expo, to be held on Yumeshima Island.
“Please don’t waste time playing games and get to it,” said an irate Hirofumi Yoshimura, governor of Osaka and an avid supporter of the early timeline. “If the national government does not set the basic policy, we cannot complete our own selection policy. Osaka’s schedule has not changed. We still want the IR to open before the 2025 World Expo.”
Osaka City Mayor Ichiro Matsui denounced the government’s maneuver as bad policy and weak politics, reported Asia Gaming Brief.
In a Twitter post, Matsui wrote, “The IR Implementation Act has already been passed, so what is the point of this delay? If the Constitutional Democratic Party of Japan and the Japan Communist Party want to campaign against it, then the answer is to meet them with bold public arguments. IRs are needed for Japan’s tourism policy and so should be realized at an early juncture.”
Some of the biggest names in global gaming have expressed interest in an Osaka casino license. Perhaps the most ardent suitor is MGM Resorts International, which has said many times that it’s committed only to Osaka, and would spend up to US$9 billion on an IR in the region with its Japanese partner, the financial services firm Orix.
But Ed Bowers, CEO of MGM Resorts Japan, said he’s unconcerned about the government’s delay, and “doesn’t expect it to have a big impact. It does not change our ‘Osaka First’ policy.”
Others looking at Osaka include Genting Singapore; the Las Vegas Sands Corp., which also would consider other big cities including Tokyo and Yokohama; and Melco Resorts and Entertainment Ltd. Melco Chairman and CEO Lawrence Ho has said he would spend “whatever it takes” to win in Japan.
One company that’s uninterested in Osaka is Bloomberry Resorts Corp., which operates Solaire Resort & Casino in Manila’s Entertainment City. Last month Solaire was named the Best Regional Asian Integrated Resort by industry members at G2E Asia. Mitsuaki Kiriyama, vice president of Bloomberry Resorts Japan Inc., told GGRAsia the company has “not yet decided which location is best,” but is considering an investment of $2 billion to $3 billion.
Jonathan Strock, president of Lucien Barrière Japan, said his firm prefers to look outside major metro areas and bid on a regional site to avoid “getting into a big fight with the American companies.”
“If we’re looking at the metropolitan areas, we’re coming face-to-face with Las Vegas Sands, MGM, Melco—the very large investments,” Strock said. “Perhaps we don’t have so much of a chance.” He described Wakayama as a “realistic” choice; in terms of a capital budget, Strock said, “US$2.5 billion seems a good place to start.” Wakayama also reportedly hoped to open an IR by 2024.
Other would-be Japan operators include Macau operator Galaxy Entertainment Group. AGB spoke to Chief Operating Officer for Japan Development Ted Chan, who said, “We’ve got to be more patient… Licensing here is a bit complicated.”
A list of potential Yokohama bidders includes Galaxy, Genting, Melco, MGM, Sega Sammy, Wynn Resorts and Caesars Entertainment.
SJM is also in the running. Assistant Chief Operating Officer Arnaldo Ho told the Macau News Agency the company would be considering “all kinds of possibilities” during the bidding process. “We are looking to be involved in everything for now.”
Hokkaido Governor Naomichi Suzuki is taking the delay in stride, and told AGB a longer timeline will let him and other stakeholders determine if they wants to pursue an IR bid. Jim Allen, CEO of Seminole Gaming and chairman of Hard Rock International, has said his firm is prepared to invest “over $5 billion” to build an IR at Tomakomai in Hokkaido, the largest figure floated for a Japanese regional market.
Of course, all future developments hang on the government’s choice of best locations and operating partners. The Japanese parliament approved integrated resorts in late 2016 as a way to boost tourism. It will license three IRs to start, and consider additional licenses after seven years. Meanwhile, MGM executive and consultant Alan Feldman said Japan is working hard to ensure that problem gambling—the issue of so much concern to the public—is understood and addressed before the market opens.
Speaking at a panel discussions at the Gambling & Risk-Taking Conference last month at Caesars Palace, Feldman said, “Japan has had gambling for hundreds of years, and all the U.S.-based companies agreed to hit this head on.”
