With the passage of legislation permitting casino gaming in Japan, global casino operators are making plans to storm one of the world’s most coveted and long-awaited gaming destinations.
On December 26, lawmakers approved the Integrated Resorts bill to bring casino complexes to at least two major metropolitan areas. It may take a full year to flesh out the plan, which would include measures to regulate and tax the industry, as well as combat gambling addiction and prevent the involvement of organized crime, reported the Japan Times.
In the interim, according to Reuters, companies including Hard Rock International, MGM Resorts International, the Las Vegas Sands Corp. and Genting Singapore Plc are scoping out venues and seeking local partners to facilitate their entry into the market.
The lure is undeniable: by some estimates, Japan could become the world’s second largest casino jurisdiction, with a possible value of $10 billion per year if two casinos are built, and $20 billion to $40 billion per year if the industry expands.
“The opportunity that Japan represents is one of the most significant anywhere in the world,” said Alan Feldman, MGM executive vice president of global government and industry affairs.
“I’m optimistic,” said Sands Chairman and CEO Sheldon Adelson in a recent earnings call. “And people tell us we’re in the pole position in terms of getting the concessions.”
And U.S.-based Hard Rock, which confirmed it has already had talks with local firms and banks in Tokyo, has formally launched its Hard Rock Japan LLC subsidiary, appointing Edward Tracy as CEO of the new division.
According to a press release from the company, Hard Rock is “no stranger to Japan with more than 30 years of experience in the country” and Hard Rock Cafes in six locations.
“With the recent passing of Japan’s Integrated Resorts Promotion Bill, the company fully intends to apply this expertise and recognition as a major contender among the bidders for resort licenses,” the statement continued.
Tracy’s appointment is meaningful, according to GGRAsia. He was president and CEO of Sands China “during a key point in its Cotai construction phase, including the opening of Sands Cotai Central in April 2012 and the development of the Parisian Macao, which subsequently opened in September 2016,” the publication noted.
As Bloomberg News reports,even before Prime Minister Shinzo Abe and his Liberal Democratic Party started pushing for integrated resorts, gambling was already big business in Japan.
In 2015, gamblers in the country wagered 23.3 trillion yen (US$203 billion) on pachinko and slot machines alone. Though that amount was down by almost one-third from a decade earlier, it amounts to 4 percent of Japan’s gross domestic product, the publication reported. It is also legal to bet on boat, horse, bicycle and motorcycle races and buy lottery tickets.
Casinos in the country won’t happen overnight, however. Though Osaka and Yokohama are most frequently mentioned as locations for the IRs, the actual locations and operators may not be chosen until 2019, with the casinos possibly opening by 2023.
Though that’s too late for the 2020 Tokyo Olympic Games, the developments could provide a boost to tourism after the games are over.
