Yumeshima the prime site
In a research note issued November 9, Japanese brokerage Nomura said if Osaka wins both its 2025 World Expo bid and an integrated resort license, it would “boost investment returns and have a positive impact on Osaka’s economy.”
The World Expo host city will be announced November 23; Osaka is competing against Ekaterinburg, Russia and Baku, Azerbaijan. The city in Japan’s Kansai region is also considered a leading contender, if not the frontrunner, to receive one of the three IR licenses from the Japan government, which legalized casinos in December 2016, according to Asia Gaming Brief.
The Nomura analysts wrote that an IR and/or the World Expo “would likely stimulate redevelopment around Yumeshima and benefit companies with real estate in the area and Osaka-based construction companies. We also believe that drawing more foreign visitors to the area would increase the stability and growth prospects for the many hotels already being developed in the area.” Yumeshima, manmade island in Osaka’s Konohana Ward, is seen as the preferred location of an Osaka IR. The word translates to “dream island” in English, reported GGRAsia.
If Osaka hosts the World Expo—which it also hosted in 1970—“this major international event would be expected to help stimulate business activity in Japan after the 2020 Tokyo Olympics,” continued the Nomura analysts. “It is still undecided as to where the integrated resorts will be and when they will open, but the prevailing view is that they will open around 2024-25, and Osaka is viewed as a leading candidate.”
Last summer, Reuters reported that executives from 11 casino companies met with Osaka’s governor 25 times for “courtesy calls” between 2012 and May 2018. According to a July report by Morgan Stanley, an Osaka casino would have to generate US$4 billion a year to produce a 14 percent annual return on a US$8 billion investment.
Meanwhile, Hard Rock Japan, which hopes to build an IR at Tomakomai, Hokkaido, is making nice with the locals. The U.S.-based gaming firm has agreed to become the “Official Top Partner” of Hokkaido Consadole Sapporo, the local professional soccer team.
“This is the first time for Hard Rock International to become a top partner to a professional sports team,” said Hard Rock Japan President Ado Machida. “I believe that this demonstrates our commitment and our vision to create a partnership with everyone in Hokkaido and to support the region in hosting a world-class resort providing family-oriented entertainment and hospitality.” The financial terms of the arrangement were not disclosed, AGB reported.
The global operators vying for a foothold in Japan will have to contend with the “tightest gaming regulations in the world,” Japanese cabinet official Naoya Haraikawa said at the recent MGS Entertainment Show, held at the Venetian Macao. Stringent regulations are a given in the country, where there is scant public support for IRs. Most Japanese think the casino sector is “a dangerous industry” that leads to problem gambling and associated social problems, Haraikawa said.
For instance, one mitigation proposal suggests that casino patrons be barred from entering a gaming venue wearing shorts or sandals, to prevent impulse gambling. Other measures already approved by the government include a limit on monthly casino visits and an entry levy of JPY6,000 (US$53) for Japanese citizens and residents who want to enter a casino.
