The president and CEO of MGM Resorts International says the gaming floor at the company’s planned Osaka, Japan, integrated resort (IR) will be reduced by 20 percent to 25 percent.
According to GGRAsia, Bill Hornbuckle revealed that the “scope has changed” for the planned resort complex on a man-made island in Osaka Bay. The estimated $10 billion price tag will not increase, he added; the investment originally was in the $8 billion range.
“We have spent an extensive amount of time rescoping the project,” Hornbuckle said. “The original project … is about 20 to 25 percent less GFA (gross floor area). We refused to move the budget. I refused to reduce the size of the casino. So it’s complicated, but we got there.”
Later this month, he added, he will travel to Japan “and sign the final two agreements: an implementation agreement and a lease for the property. That means we can start in earnest, and to the extent we’re able to do that, (the IR) will open in 2030. It’s been a journey.”
Integrated resort complexes with gaming were first approved by the Japanese parliament in December 2016. Covid-19 scuttled global interest in the new market, which analysts once said could be as important as Macau. A second IR proposal, from Nagasaki prefecture, is still under review by the central government.
In Hornbuckle’s view, “If you think about the marketplace, we’ll probably be the only casino for a very long time in Japan.” And that could be a good thing for MGM, given the population and Osaka’s proximity to Mainland China. “You have 100 million people in Japan and 19 million in Osaka alone,” the CEO said. “I’m extremely excited about the potential of this, and the kicker is (Osaka) is closer to Shanghai, Beijing and the northern China cities than Macau.”
MGM Resorts is the majority owner of Macau gaming operator MGM China Holdings Ltd. The China unit was supposed to own 40 percent of the Japan IR complex, with its Japanese partner Orix Corp. controlling another 40 percent, and smaller investors holding 20 percent. But MGM and Orix now reportedly will increase their shares to 42.5 percent each, leaving 15 percent to the other investors.
In related news, Osaka may need to invest $174.6 million of public money for land improvement at Yumeshima Island in Osaka Bay, which will also host the 2025 World Expo.
