Las Vegas Sands Targeting South Korean City of Busan for $4.5 Billion Casino Project
Posted on: February 17, 2015, 02:15h.
Last updated on: February 17, 2015, 01:48h.
Sheldon Adelson has never been shy about throwing money around to expand or protect his business.
This has proven true most recently in Asia, where Las Vegas Sands has shown a willingness to spend billions if it will gain them access to lucrative markets like Japan.
Now, the Sands is looking to South Korea for its next major investment: but only if the government will make some concessions in order to sweeten the pot.
Investment Contingent on Local Participation
Las Vegas Sands has said that they would like to build a $4.5 billion casino complex in Busan, the second-largest city in South Korea, but only if the government is willing to allow locals to gamble in the casino.
That could potentially be a major sticking point, however, as only one of the 17 casinos currently active in South Korea allows locals to play. All of the other casinos in the nation are “foreigners only,” something that Adelson has previously said he’d have no interest in.
This isn’t the first time that the Sands has suggested that Korea could be a major target for them. Last September, Sands managing director of global development George Tanasijevich said that the company would be interested in building an “iconic” resort near Jamsil Stadium, one of the sites of the 1988 Olympic Games.
At the time, Tanasijevich said that allowing locals in would be a requirement for a Sands investment, though the company was open to rules similar to those in Singapore, where locals must pay fees and demonstrate that they can meet financial benchmarks in order to play.
This time around, such a project may have more local support. Tanasijevich reportedly met with Busan mayor Suh Byong-soo on Friday, and it appears that Suh is on board with the plan: he reportedly said that integrated resorts are necessary to Busan in order to draw tourists to the region, and that the central government should revise existing gaming laws to make such a project possible.
National Government Unlikely to Change Laws
However, that doesn’t mean that the national government will be just as happy to see the Sands establish an inclusive gaming resort inside their borders. Casinos in South Korea have traditionally been built as a way to increase revenue from foreign tourists, so the government may not be persuaded even if the nation would make significant revenue by letting South Koreans gamble at the resort.
In addition, allowing Sands to have such a casino might anger other operators, who in turn may ask for the same rights themselves.
For now, however, it seems that Sands is hoping to win over officials by touting the economic benefits of such a resort. Tanasijevich said that the resort could generate as much as $355 million in new tax revenues for the Korean government, and that over 50,000 jobs could be created.
However, he reiterated that the company would only invest in such a project if the laws prohibiting Koreans from casino gambling were lifted or substantially amended.
Many casino firms have expressed interest in investing in South Korea recently, including Chow Tai Fook in Hong Kong, which plans to build a $2.6 billion foreigner-only casinos west of Seoul by 2022.
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