A Las Vegas Sands Corp. executive has made it clear that the U.S. gaming giant is interested in developing an integrated resort in Osaka, Japan. George Tanasijevich, the company’s managing director for global development, has disclosed that the operator is in talks with several companies in the Osaka region about making a “joint bid” for an IR on Yumeshima Island.
In an interview with the Sankei Shinbun, Tanasijevich said the partnership would boost the Sands Corp.’s chances in Osaka and also add Japanese business savvy; it is generally expected that a foreign operator will ally itself with a local enterprise. Tanasijevich also said the Sands Corp. is not looking only at Osaka, but also is interested in Yokohama and Tokyo, reported Asia Gaming Brief.
Tanasijevich hit all the right notes as he spoke with local media, stressing that Sands will prioritize “buying local” and help local companies become suppliers. “The ingenuity, determination and diligence of the millions of small and medium-sized local companies is part of what made the ‘made-in-Japan’ label so highly regarded in the world today,” he said. “We are committed to work with these companies to continue this foundation of Japanese commerce. We believe that through a local-first supply chain, the integrated resort will being significant economic benefits to the local regions.”
Sands’ rival, MGM Resorts International, is committed to Osaka alone, according to Jim Murren, chairman and CEO. In a recent earnings call, he confirmed, “We are focusing our energies there. We have been developing consortium partners, exciting programming, getting ready for RFP submission.
“We have no illusions to the fact that it will not be competitive,” Murren continued. “It will be highly competitive, but I think the cards are stacked in the favor of those who are prepared, who have been working hard, who will have the best program, best strategy, the best understanding of the country, of the prefecture, and I like a lot MGM’s chances.”
Murren added that he expects Osaka to choose its consortium partner in early 2020. “We’ve committed now to the mayor and to the governor of Osaka that MGM has adopted in Osaka First strategy.”
Meanwhile, according to CDC Gaming Reports, Philippine gaming and hospitality company Bloomberry Resorts and France’s Groupe Barrière have confirmed their intention to pursue an IR license in Wakayama.
Speaking at the Wakayama IR Business Development Seminar, Mitsuaki Kiriyama, Bloomberry’s vice president in Japan, said, “We have been hoping for this opportunity. Osaka and Wakayama can both succeed and we can expect a synergistic effect between the two.”
Tatsunobu Yokoyama, the prefecture’s director of planning and policy, stated, “Wakayama is close to Kansai International Airport and the Kyoto-Osaka-Kobe area, rich in history, culture and nature with great food too. This area has plenty of potential for selection. We believe that we will be certified if we establish a suitable business plan.”
Tamao Nakamura, a representative of a local security company focusing on tourism development, was also enthusiastic, saying, “Staff shortages are a big problem. IR is an attractive solution for an area like Wakayama that is losing its population.”
Meanwhile, Osaka City’s budget for fiscal year 2019 includes JPY163 million (about $1.5 million) for expenses related to an integrated resort—a show of confidence that the city will win one of Japan’s first IR licenses, reports Asia Gaming Brief. The budget allocation covers the costs for operator selection, license application, public hearings, and programs to combat gambling addiction.
These costs do not include the JPY5.8 billion ($52 million) the city will devote to the development of land and infrastructure on Yumeshima Island which will host the 2025 World Expo. Over the next seven fiscal years, that development total is expected to reach JPY95 billion (US$860 million).
Most of the funds will go toward the extension of the Osaka Metro Chuo Line to Yumeshima and the construction of a new railway station. AGB noted that some of these costs “may later be shifted to the IR operators and other beneficiaries of the Chuo Line’s extension.”
The overall Osaka 2019 budget comes to more than JPY1.83 trillion (US$16.7 billion), up 3.3 percent year-on-year.
