Japan Okays $8.1 Billion MGM IR in Yumeshima Island, Osaka

It’s all systems go for the establishment of Japan’s first-ever casino after the approval of a ¥‎1.08 trillion ($8.1 billion) Osaka Integrated Resort (IR) casino project. This arrangement will see global casino giant MGM pitch camp in the Asian powerhouse, and the project is estimated to be completed by 2029. Should things go according to plan, the MGM IR is expected to significantly boost domestic and international tourism in the Land of the Rising Sun.

The project will see MGM’s grip tighten on the general global casino landscape. And already, the gaming giant is the largest operator of casinos in the Las Vegas Strip, and it also has a strong presence in Macau, which is currently the world’s largest gaming hub.

MGM will team up with local stakeholder Oryx Corp, where each company will hold a 40% stake in the IR to manage this massive project jointly. The remaining 20% will be held by 20 companies, where the most prominent project financiers are MUFG Bank and Sumitomo Mitsui Banking Corp, supplying ¥‎550 billion worth of financing.

Events Preceding this Monumental Project

Japan’s plan to legalize casino establishments in the country dates back to 2018 when the then-Japanese PM Shinzo Abe advised the ruling party Liberal Democratic Party (LDP), to legalize the activity. Current PM Fumio Kishida who has been in office for a little over one year, hopes that the proposed casino establishment will attract first-time and repeat visitors to the island of Japan.

Despite receiving the former PM’s backing, the push to allow casino establishments in Japan faced significant opposition. Be that as it may, the powerful LDP successfully push through its gaming bill on the last day of 2018. With Japan opening its doors to casino establishments, it was only a matter of time before the giants took notice of a global gaming superpower.

What to Expect for MGM’s Osaka IR Project

The casino resort will be located on the island of Yumeshima in Osaka Bay. It is set to include hotels, a conference center, a casino, a museum, a shopping center, and a ferry terminal. Exuberant spenders will also be thrilled to know that the casino resort will include a helicopter pad should they want to land from the skies. With the island set to host the World Expo 2025, it seems that the fun has only just begun for its residents and, indeed, the citizens of Japan at large.

Japanese PM Fumio Kishida remarked that this project would spur economic growth in the Kasai region around Osaka and Japan, especially with the oncoming World Expo. Furthermore, given that the country was hit hard by the Covid 19 pandemic, the okayed IR is set to help it bounce back economically by channeling significant funds in terms of investments and tourism.

The project was initially fronted to be greenlit earlier than this year, but a string of factors had caused consistent delays. For one, there was a long-drawn-out legislative process to legalize gaming, and then there was the Covid-19 pandemic which pushed many prospective casino partners to exit the Japanese scene. However, MGM, which has had a longstanding interest in the Asian country, stuck through the hard times, and eventually, it seems they are reaping the rewards.

According to MGM, the Integrated Resort is expected to draw a whopping 20 million visitors annually: 14 million domestic and the remaining 6 million international. According to industry insiders, the establishment is initially expected to generate revenue from gaming before spreading its revenue streams to the vast enterprises built around MGM’s gaming empire.

Local Criticism Still Persists

Despite obvious economic benefits that will likely be realized with this project, public opinion is still pretty divided on whether this IR is necessary. According to a recent Mainichi newspaper poll, 45% of Osaka residents still support the proposed casino, 38% are against it, and 17% are undecided. Further, the poll also suggested that the casino is more likely to face opposition from the relatively elderly population and women.

Reservations of the Japanese public emanate from an assertion that there is already a prevailing gambling crisis in the country that the development of the casino could exacerbate. Moreover, there are some concerns that the casino could spike crime rates in the area.

To address some of the issues, the Japanese government announced a few restrictive measures, one of which was that its citizens would be charged ¥‎6,000 for every 24 hours spent in the casino. The bulk of this fee will be allocated to helping the country tackle any problem gambling incidents. Additionally, a cap has been placed on the number of times one can visit. Family members have also been given the right to apply for the ban of a relative they deem to be facing problem gambling.

Nagasaki’s Integrated Resort Bid is Also Poised for Approval

The Japanese government is also expected to okay the Nagasaki Integrated Resort bid in the coming months. Casinos Austria International won the bid to develop and operate Nagasaki’s Integrated Resort on the huge Huis Ten Bosch, Japan’s largest theme park.

Expressing excitement about her company’s win, Casinos Austria International CEO Bettina Glatz Kremsner said:

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“By passing this milestone in the award process in Japan, Casinos Austria International has once again demonstrated the kind of excellent reputation that the company enjoys abroad.”