MGM Resorts International remains fully committed to pursuing an integrated resort (IR) in Osaka, Japan, despite the havoc being wrought by the Covid-19 pandemic. Acting CEO Bill Hornbuckle, who succeeded Jim Murren on his departure in March, recently said, “We still see Asia as a huge build and a huge upside for the company, and frankly for the industry.”
MGM’s potential investment hasn’t changed, he added; it’s still “in the zone of US$10 billion,” with the returns to be determined once the Japanese government finalizes its regulations. “We’re absolutely bullish on Japan in the long run,” Hornbuckle said.
As reported in Inside Asian Gaming, Hornbuckle made the comments during MGM’s first-quarter earnings call on May 1. The company had earlier reported monthly cash outflow of US$270 million in the United States, where all its properties remain closed, and another US$1.5 million daily in Macau—or US$45 million per month—where border restrictions have flattened tourism.
Osaka, Yokohama, Nagasaki and Wakayama are all considering a bid for one of three IR licenses in the first phase of market liberalization. MGM and the Osaka government had been pushing for a fast-tracked development that would be open before the 2025 World Expo on Yumeshima Island. That plan was later abandoned as unrealistic, and the Covid-19 contagion is likely to slow the process as well.
“We are not definitively sure of the RFP process as it currently sits in Osaka,” Hornbuckle noted, “but we’re ready for this. We have an RFP submission (in Osaka) that’s due at the end of July. Our team has worked hard on this and as you know we’re the lone standing applicant there.
“We would submit, but I think what may happen is the whole process gets pushed closer to the end of the year, which I think is appropriate and fine by us. I think it will get delayed and we’re ready whether it does or it doesn’t.”
Galaxy Entertainment Group and Genting Singapore had applied to submit a bid in Osaka, but both dropped out of the race in February.
In related news, Wakayama has announced that two companies have responded to the prefecture’s RFP assessment call, which ran from late March to the end of April as part of the IR bid process.
The applicants were Suncity Group Holdings Japan Co. Ltd., the Japanese arm of Hong Kong’s Suncity Group, and Clairvest Neem Ventures, the local subsidiary of Canadian IR investment firm Clairvest Group.
There was no response from Barrière, the French operator which had initially showed interest, or from Philippines IR operator Bloomberry Resorts.
According to IAG, Governor Yoshinobu Nisaka said he was “relieved” to see two operators come forward.
