A major boost for Japans fledgling casino sector, MGM Resorts International has apparently relinquished its option to quit the huge built-in resort plan in Osaka. It also means a strong commitment to the venture which is expected to be the first legal casino in Japan once the building is completed in 2030.
In Osaka, the proposal for an integrated resort developed by MGM Resorts International and the Japanese financial services company Orix Corporation has been under discussion for several years. The plan with the estimated cost of close to 1.27 trillion yen ($8.9 billion) will turn Yumeshima, an artificial island in Osaka Bay, into an international hub for tourism and entertainment.
At the onset, the preliminary contract signed between the MGM and Osaka local officials has a provision that permits the developer to cancel the deal if some factors are not favorable. Other conditions include, for example, tax treatment, necessary investments, improvement of land, and the number of tourists. However, to sacrifice this particular right, it is clear that MGM is sure and convinced about the prospect and the sustainable nature of this project.
The decision to proceed comes at a good time for Japan’s tourism sector, which is yet to fully recover from the effects of the COVID-19 outbreak. Osaka Integrated Resort is expected to welcome six million international visitors and fourteen million domestic visitors yearly, making strong positive impacts on the regional and national economies.
In the complex we will find not only casino, but also hotels, CV centers, shopping malls, museum, and even ferry terminal. High-end visitors will also be able to use a helicopter pad as the creators of the resort tried to meet the needs of as many guests as possible.
Financial expectations as to the revenues of the resort are also very high: gross annual sales forecast amounts to 520 billion yen ($3,6 billion) hob. This buttressed by estimates that gaming revenue makes up approximately 80% of the projected income this is a clear indication of the critical role that gaming will play in the realization of this project.
Nevertheless, the outlined initiative has its share of difficulties and controversies registered during the work. Japanese public still has mixed feelings on integrated casino resort and some polls show a massive no to betting. In regards to problem gambling, the government put measures into practice that include charging 6,000 yen ($42) entry fee to Japanese citizens and foreign residents, but no charge to foreign tourists.
The integrated resort in Osaka is also to enter a mature market within the region with existing casino resorts in Macau, Singapore and Philippines. But the supporters of the project say that Japan has a different cultural value proposition and the dearth of complete resorts’ will make a difference.
With other preparatory construction work due to commence this month, everybody will be watching Osaka undertake this monumental process. The outcomes of the first integrated resort in Japan will set the tone for future destination positioning, tourism development, and the country’s role in the international gambling market.
Thus, with MGM back on board, the lion’s share of the Osaka integrated resort project can begin anew. Yet, there are still issues, such as the risk of evident clashes with the next 2025 World Expo, launched on the territory of Yumeshima island. As more construction occurs and the date of opening draws near, the project will doubtless remain a matter of significant interest and controversy both in Japan and among international gaming circles.
