Las Vegas Sands Focusing on Tokyo or Yokohama for Japan Casino License
Posted on: August 22, 2019, 12:18h.
Last updated on: August 22, 2019, 03:21h.
Las Vegas Sands (LVS) has suddenly taken itself out of the running for a resort casino license in Osaka, Japan and instead will compete in the more populated cities of Yokohama and Tokyo.
The company announced the change of focus in a statement released on Thursday. It was just in June that George Tanasijevich, Sands managing director of global development, said an interview with Inside Asian Gaming that LVS thinks the “possibilities are very low for both cities (Tokyo and Yokohama) at this point.”
For years, Las Vegas Sands was highly interested in opening a casino hotel in Osaka. It is Japan’s third-largest city.
But in the new statement, Sands CEO Sheldon Adelson said the company wants to “target new development opportunities that allow us to maintain our industry-leading returns on invested capital — and we think an investment in Tokyo or Yokohama gives us the best opportunity to do exactly that.”
Adelson also confirmed that for several years Sands has “engaged in a conversation with the Osaka government regarding the possibility of building a world-class Integrated Resort [IR] there.”
Additionally, the company says it will “drive organic growth by strongly reinvesting in our existing portfolio of properties in Macau, Singapore, and Las Vegas.”
The company’s statement was released only a few hours after Yokohama officials said the city wants proposals for a resort casino, according to Bloomberg News. As envisioned, it will be constructed on Yamashita Pier.
The city is the second-largest in Japan. It is located on Tokyo Bay and is about a half hour’s drive from the nation’s capital of Tokyo.
Yokohama Flip-Flops on Wanting Resort Casino
Initially, Yokohama had been uninterested in capturing a gaming license. There were concerns over crime and other issues.
A poll of Yokohama residents also found last September that 97 percent of those questioned had negative views of a casino there.
But now Yokohama Mayor Fumiko Hayashi announced that “I’ve come to the conclusion that in order to achieve growth and development, we need [an] IR.”
Many gaming sector observers predict that Osaka will be the first location in Japan to get an IR. Currently, only three licenses will be granted by Japan’s national government.
Several prominent casino operators are interested in applying. Different cities are expected to lobby to be considered.
MGM Resorts International and Orix Corp. have prioritized opening a resort casino in Osaka. Melco Resorts & Entertainment Ltd., Wynn Resorts Ltd., and Galaxy Entertainment Group are eager to open a property in Osaka, too.
Other areas vying for a casino license may include Wakayama, Nagasaki, Hokkaido, and Kanagawa. No resort casinos are expected to be open in time for the 2020 Olympics — to be held in Tokyo.
Once the casinos are in place, Japan’s gross gaming revenue (GGR) is predicted to total $20 billion a year, according to CLSA, an Asian-based brokerage and investment firm, Bloomberg reported. It could wind up as the second-largest gambling hub in Asia. Macau is likely to remain first.
To get an idea of which companies are vying for the Osaka license, GGRAsia noted several organizations which were highlighted at the Japan IR Expo forum held in May. These had included: Galaxy, Genting Singapore Ltd, Las Vegas Sands, Melco, MGM Resorts, Wynn, and a local alliance from Osaka.
In March, MGM Resorts CEO Jim Murren predicted that Osaka would be the first region approved for an IR in Japan. “We’ve made a decision to focus all of our energy on Osaka,” Murren has said.
Murren added that a lengthy licensing process in Japan could prohibit opening an IR in Osaka in time for the city’s hosting of the 2025 World Expo.
Japan Casinos May Not Open until 2026
Despite the keen interest, the first Japanese casino resorts may not open until 2026, according to an analysis by Global Market Advisors (GMA).
Japan’s government is expected to provide more details soon on its plans and the overall review process for casino proposals. Japan legalized casino resorts only last year.
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