South Korea Still Prime Target for Casino Resort Development Despite Legalization of Japanese IRs
Posted on: July 19, 2019, 09:39h.
Last updated on: July 19, 2019, 09:39h.
South Korea is still being closely looked at by major casino operators for possible development despite the world gaming industry’s focus on Japan and its three forthcoming integrated resorts (IR).
GGRAsia spoke this week with Mohegan Gaming VP of Corporate Finance Christopher Jones who said South Korea is a viable target for such large-scale casino properties.
There are over 700 million people and some of the largest cities in the world, all within three hours of both Korea and Japan,” Jones told the gaming media outlet focused on Asia markets.
“So, from a market perspective and overall proximity and convenience, we believe there is ample demand to support the development of integrated resorts in South Korea and Japan,” Jones concluded.
Jones has plenty of reason to take such a position. His employer is currently in the process of building a $1.6 billion IR at the Incheon International Airport. The casino resort – dubbed Inspire – will feature 700 slot machines and 150 table games, 1,250-room hotel, large convention space, and Paramount Pictures theme park.
Mohegan is considering additional investment phases at Inspire, with a total price that could hit $5 billion.
Mohegan Gaming, the casino operator of the Native American tribe based in Connecticut, is one of numerous companies bidding for a Japanese gaming license. The market is expected to become the second largest casino hub in the world behind only Macau once it matures.
But with only three IRs – and major players including Las Vegas Sands, MGM Resorts, Caesars/Eldorado, Wynn Resorts, Melco Resorts, and Hard Rock readying to make massive multibillion-dollar pitches to win licensure, some of the companies won’t be welcomed in Japan and might need to look elsewhere.
Mohegan isn’t alone in preferring South Korea. Caesars Entertainment has proposed building a $700 million IR near Incheon Airport. However, the company’s $17.3 billion acquisition agreement from Eldorado Resorts has thrown those plans into jeopardy.
South Korea is presently home to 17 casinos, but all but one are foreigner-only gaming venues. The exception is the remote Kangwon Land resort, which is 100 miles southeast of the Seoul capital.
The fact that South Korea doesn’t allow its citizens to gamble anywhere except its state-owned Kangwon Land isn’t ideal for commercial casino operators, but it won’t stop investment considerations.
As the market grows, it is expected that there will be more demand for visiting Korea for gaming purposes,” an unidentified executive with the Paradise Casino in Incheon told GGRAsia.
The source believes Japan could entice the South Korean government into allowing their own to legally gambling in their home country. “One thing is clear: if a casino is opened in Japan, it is likely that many Koreans will be gambling in Japan, which could be a burden on the Korean government,” the Paradise exec added.
However, others say the South Korean’s sensitivity to potential problem gambling is so strong that a liberalization shouldn’t be expected. The Korea Center on Gambling Problems recently submitted a report to the federal government showing a troubling increase in Korean teenagers gambling online.
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