MGM, Japan Partner Orix Prepping $9.1 Billion Osaka IR Bid
Posted on: July 19, 2021, 09:04h.
Last updated on: July 19, 2021, 02:38h.
MGM Resorts International and its local partner, Orix, will reportedly unveil a $9.1 billion proposal for an integrated resort project in Osaka on Tuesday.
The Bellagio operator and the Japanese financial services conglomerate partnered on the endeavor more than two years ago, and today stand as the only firms looking to bring a gaming venue to Japan’s third-largest city.
The $9.1 billion price tag is below previous estimates ranging from $10 billion to $15 billion. Those were sums gaming executives and industry analysts previously speculated a single Japanese casino resort would cost. Even at $9 billion, the venue would be the most expensive gaming property on record. That’s assuming that price proves accurate and no other Japanese integrated resorts are built.
The $9.1 billion is viewed as something of a relief because it’s a digestible number for MGM and Orix. However, there were also concerns that the pandemic could prompt operators pursuing Japan gaming licenses to scale back proposed investments.
Orix is the majority partner in the plan. That defrays some of the costs MGM would encounter if they were going it alone in Japan. But it also limits the gaming giant’s upside potential in the country.
In Osaka, Good News and Bad News
While it’s positive that MGM and Orix are moving forward with plans to bring a casino property to Osaka and are doing so at a potentially tolerable price point, there is some bad news involving the timeline to getting the integrated resort operational.
Previously, there were hopes that if Japan’s process for awarding its first three gaming licenses moved efficiently enough and that if Osaka was one of the initial winners, it’d be possible to have the venue open and functional by late 2024. That would be in advance of the city hosting the World Fair the following year. Today, that looks like a pipe dream.
In terms of the time line for opening, however, it has now been pushed back even further, with the proposal suggesting that business operations may commence sometime between 2028 and 2030,” reports Asia Gaming Brief.
That’s the first time there’s been any talk that the Osaka gaming venue could open outside of the current decade. There’s also chatter that the integrated could open in phases.
Other Japan Casino News
Yokohama, widely seen as perhaps the most credible competitor to Osaka’s casino operations, is about a month away from a mayoral election that could determine that city’s fate in the integrated resort competition.
Mayor Fumiko Hayashi, who is in favor of bringing a gaming venue to Japan’s second-largest city, is seeking a fourth term. However, market observers are speculating that if she’s defeated, Yokohama’s integrated resort aspirations could suffer as a result.
Genting Singapore and Melco Resorts & Entertainment, both working with local partners, are vying for the Yokohama rights.
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