Japan Announces New Integrated Resort Submission Period
Posted on: December 18, 2020, 07:57h.
Last updated on: December 18, 2020, 02:11h.
Japan has formally announced a new submission period for when its central government will field integrated resort (IR) proposals from casino operators and prefectures.
Originally slated to run July 30, 2021, to April 28, 2022, COVID-19 has pushed back the timeline. Japan now says casinos and their host locations will be able to present bids starting October 1, 2021. The April 28, 2022 end date was not altered.
Japan is slowly in the process of bringing three large-scale casino resorts to the country. The appetite to invest in the Land of the Rising Sun, however, has lessened in recent months.
The country was once viewed as the largest gaming market opportunity after Macau ended SJM Holdings’ monopoly some 20 years ago. However, many of the world’s largest casino operators have grown frustrated with Japan’s regulatory process.
Las Vegas Sands considered the gold standard IR company, announced in May it would not be making a play in Japan as once highly expected.
Former Japan Prime Minister Shinzo Abe and his controlling Liberal Democratic Party (LDP) were the driving force behind legalizing commercial gambling. Abe departed politics earlier this year because of health reasons. But his successor, Prime Minister Yoshihide Suga, is carrying on the gaming mission.
Casinos are viewed by LDP lawmakers as a key component to grow tourism in Japan. Just two years ago, Abe said the goal is to attract 40 million foreigners each year by 2020.
The target of 40 million visitors to Japan in 2020 is now within our reach. We will swiftly work toward it in the next two years,” Abe told his Cabinet in 2018.
Of course, Abe’s comments were floated prior to a global pandemic. As is the case in countries around the world, COVID-19 has brought international travel to Japan to a standstill.
Japan welcomed just 56,700 international visitors last month, according to the Japan National Tourism Organization. The agency says visitation is down 99 percent in 2020.
The basically nonexistent international travel is a major reason why Japan has pushed back its IR submission period. Casino operators have struggled to send their executives to Japan in 2020 to form local consortiums and build relationships.
Luring IR Operators
Japan has its work cut out for it in making its forthcoming casino market appealing for an investment that will likely run several billion dollars. Sands is out, MGM Resorts says it’s seeking a reduced role in Osaka, and Wynn Resorts closed its office in Yokohama earlier this year.
Gaming analysts say Japan must offer competitive tax rates on gross gaming revenue (GGR), not over-regulate operations, and allow flexibility with the design schemes.
Several well-known gaming giants say they remain interested. Companies include Melco Resorts, Galaxy Entertainment, and SJM Holdings, three of the six casino concession holders in Macau. US-based Hard Rock International is also expected to throw its name in the candidacy pool. Malaysia-based Genting Group is another group prepping a play.
Caesars Entertainment, which has long been scrutinized for not seizing the Macau opportunity, is skipping Japan, too.
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