Eight areas in Japan are entertaining the idea of hosting casinos as part of larger integrated resorts, the nation’s Tourism Minister Kazuyoshi Akaba said at a Tuesday news conference.
The eight areas named by the minister were Hokkaido, Chiba City, Tokyo, Yokohama, Nagoya, Osaka City, Wakayama Prefecture, and Nagasaki Prefecture. Minister Akaba cited the results of a survey conducted by the Japan Tourism Agency.
The agency carried out the survey between September 9 and September 19, and, as reported by local news outlets, is set to conduct interviews with officials from each of the eight areas to confirm the status of their preparations for participating in the casino race.
Local governments that are interested in hosting integrated resorts with dedicated gaming floors are required to file their development plans for approval from the central government. The Japanese Diet has previously said that it would issue up to three casino licenses for the development of gaming resorts at three locations around the nation.
A separate survey conducted by Japanese news agency Jiji Press found that the cities of Kawasaki and Hamamatsu, Shizouka Prefecture, were also interested in being hosts of one of Japan’s first casino resorts.
Developers Could Face Major Hurdles Due to Casino License Renewal Process
As local governments are preparing their respective areas’ bids for the casino race, the central government still has a number of details to iron out before the actual start of that race. Last week, analysts from Fitch Ratings brought attention to one important detail related to the legalization, regulation, and operation of the nation’s first casinos.
Japanese regulators could force the approved casino resort operators to renew their gaming licenses every 10 years, it has become known. However, this could create big hurdles for developers to procure financing for their resorts.
Obtaining capital is an important step for operators in order to be able to complete the construction of any resort located anywhere in the world. However, it is particularly important in Japan, where casino resorts are expected to require more than $10 billion in investment.
According to recent comments by Fitch analysts, the required investment could even soar to up to $15 billion, “after accounting for supporting infrastructure investment and meeting the stipulated amenities, such as the cultural requirements.”
Osaka Race Narrows to Three Bidders, MGM Seen as the Frontrunner
After Melco Resorts & Entertainment and Las Vegas Sands announced in recent weeks that they were dropping their Osaka bids and would instead focus their Japanese expansion efforts on development opportunities in Yokohama, and Caesars Entertainment abandoned its Japanese ambitions altogether, it emerged that the race for a casino permit in Osaka has narrowed to just three bidders.
According to Japanese media reports, the operators still interested in obtaining a license to develop and operate an integrated resort on Osaka’s man-made Yumeshima Island are MGM Resorts, International, Galaxy Entertainment Group, and Genting Singapore.
Fitch Ratings analyst Alex Bumazhny said in a recent interview with GGRAsia that Sands and Melco’s exit from the Osaka race “certainly increases the probability that [MGM], which was already a strong contender, wins the [request for proposal] there.”
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