Nagasaki Resort Draws Investment Interest From Cantor Fitzgerald, Credit Suisse
Posted on: September 9, 2022, 09:32h.
Last updated on: September 9, 2022, 10:39h.
Japan will soon announce whether it will accept proposals submitted by Osaka and Nagasaki officials for an integrated resort (IR). If Nagasaki makes the cut, Cantor Fitzgerald and Credit Suisse are both reportedly willing to open their bank accounts to the casino project.
The IRs that Osaka and Nagasaki envision won’t come cheap. Osaka’s resort costs are projected at around $9 billion. In Nagasaki, the project will run about $4 billion. However, the prefectural government will shoulder a considerable amount of that.
This is where Cantor Fitzgerald and Credit Suisse come in. GGRAsia reported that Nagasaki Governor Kengo Oisho stated this week that they have offered their financial services.
Nagasaki estimates the annual gross gaming revenue (GGR) it receives from the IR’s casino will reach JPY150 billion (US$1.05 billion). The prefecture will receive JPY22.5 billion (US$157.83 million), or 15% of that.
The involvement of the two global financial firms would seem to indicate that they’re optimistic about the success of Japan’s IR plans. Credit Suisse and Cantor Fitzgerald have been actively looking for ways to be part of the proposed development, having sided with Wakayama when it was still in the race.
The companies could provide as much as 80% of the equity needed for Nagasaki’s project, according to Oisho. Both have presented “commitment letters” outlining their potential involvement. The governor made the revelation during a regular meeting of the prefecture’s IR committee this past Tuesday.
Whether Nagasaki needs the investments, or can use them, remains open. The Japanese national government needs to make its selections first.
In accordance with the rules the national government established, as many as three IRs were possible in the first round of approvals. In spite of huge global interest at first, there were only two final candidates.
Japan can choose one, both, or none of the IR proposals. If it chooses none, the project could be scrapped. If, on the other hand, it chooses to move forward with both, the first IR could arrive in 2027. Nagasaki believes it can complete its work by then, while Osaka is eyeing 2029 for its grand opening.
Japan’s IR committee should announce its decision before the end of the year.
Nagasaki Theme Park Changing Hands
A popular destination for tourists adjacent to the land for Nagasaki’s proposed IR has a new owner. The Japanese travel agency H.I.S. had been considering a sale of the Huis Ten Bosch theme park for a couple of months. At the end of last month, it finalized a deal.
H.I.S. is selling its roughly 66% stake in the theme park to PAG, a Hong Kong-based private asset management firm. The sale will give it around $482 million, although H.I.S. probably hoped for more.
When the company announced the potential sale, the travel agency only mentioned a price of “tens of billions of yen.” That provides a wide range of options. But the park’s location should certainly warrant greater value. PAG got a steal, as it had valued the H.I.S. stake at around $701.4 million, according to Japanese media.
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