Most operators look for population, airports
Japan’s pending casino industry will likely launch with two or three large integrated gaming resorts in large cities like Tokyo, Osaka and Yokohama. The emphasis on major metropolitan areas has some officials in smaller cities saying it undermines Prime Minister Shinzo Abe’s goal of reviving rural areas.
Bloomberg News reports that most global casino operators want to invest in one of the three major cities due to their high population and proximity to major international airports. Would-be operators must partner with municipalities in drawing up their proposals.
That’s “changed the power structure between operators and local governments,” Yoshinobu Nisaka, governor of Wakayama Prefecture said at the Japan Gaming Congress earlier this month. “Where did the view that this was for local revitalization go?”
Officials in other secondary markets including Nagasaki and Hokkaido also want to get in the game and say the present approach will lead to big operators in big cities. Hiroya Ebina, mayor of Kushiro, said he is “so disappointed” by the developments.
The Las Vegas Sands Corp. acknowledges it is interested in one of the Big 3 candidates. “The location that works best for our business model is the major cities,” said Marina Bay Sands CEO George Tanasijevich. “So we’re talking about Tokyo, Yokohama, Osaka. We need to be in a major city that’s connected to a major international airport so we can bring in the millions of people that we want to host at our property.”
That sentiment was echoed by Ed Bowers, executive vice president of global development for MGM Resorts International. “MGM’s business model is to build large-scale destination resorts with lots of stuff that cost a lot of money,” he said. “So it needs to be in a high density population area, and obviously the ones to be mentioned are Tokyo, Osaka and Yokohama. So we’re focused on those three.”
Caesars Entertainment Corp. hasn’t ruled out smaller jurisdictions, says the company’s president of international development, Steven Tight. “We are currently exploring opportunities in both urban and regional markets,” he said.
Potential revenues from integrated casino resorts in Japan are a big draw. Investment bank CSLA Ltd. says they could top $25 billion a year, making Japan the second-biggest gaming market in the world after Macau based on 2015 numbers.
