Las Vegas-headquartered casino operator MGM Resorts International is mainly interested in extending its footprint in two particular Asian jurisdictions – Macau and Japan, despite the fact that a number of other countries in the Asia-Pacific region, including the Philippines and South Korea, are offering expansion opportunities at present.
James Murren, CEO of the company, said during his latest visit to Japan that they are particularly interested in the newly opened Japanese market and that they are ready to invest up to $10 billion into building an integrated resort with a casino facility in the Pacific Ocean island nation.
Mr. Murren revealed that he has traveled to Japan around 15 times in the past several years. The gambling executive has been exploring the local business environment and has been looking for potential business partners, in case MGM is selected as one of the preferred operators of the country’s first casinos.
Japan legalized casino gambling last December when the Diet, the nation’s legislature, passed the first of two bills on the matter. However, Japanese lawmakers are yet to pass the second piece of legislation and analysts have pointed out that this might happen in the first or second quarter of 2018.
Under Japan’s casino law from late 2016, interested developers will be allowed to build two integrated resorts with casino floors in two unspecified locations. Details about the locations of the gambling complexes and other important aspects related to the complete legalization of casino gambling in the country will be determined by the second casino bill.
MGM has not been the only major integrated resort developer to have expressed interested in investing in Japan. The likes of Las Vegas Sands, Wynn Resorts, Hard Rock International, Melco Resorts & Entertainment, and Genting Group have also announced that they will contend for one of the two Japanese casino licenses.
Details about MGM’s Plans for Japan
As reported by Asian news outlet Nikkei Asian Review, Mr. Murren told local media that his company will form a consortium with Japanese businesses to built and operate an integrated resort that will feature hotels, food and beverage, retail, and meeting and conference facilities, among a number of other amenities. The casino portion of the complex will occupy 2% of the overall floor area.
The MGM CEO further noted that the gambling facility will likely represent a considerable part of the property’s total revenue, but he pointed out that it was still too early to try to predict the exact percentage.
If it wins the casino license, MGM will focus on attracting customers from the high-end mass market rather than striving for high roller players. As Mr. Murren pointed out, they have begun adopting the mass market growth strategy with their new property in Macau – MGM Cotai, which is slated to open doors next year.
Macau had previously been a popular destination for high rollers from Mainland China. However, VIP revenue has decreased significantly in recent years as there has been withdrawal of that particular gambling group from the city. The anti-corruption campaign of Chinese President Xi Jinping has been largely blamed for the revenue crisis Macau found itself in in the period between 2014 and mid-2016.
Mr. Murren said that their new resort in the world’s gambling capital will be focused on the high-end mass market and will provide “some guidelines” for their future venture in Japan.
