GGRAsia – Launch costs push Nagasaki IR price tag to US$3.8bln

Launch costs push Nagasaki IR price tag to US$3.8bln

Mar 11, 2022 Newsdesk Japan, Latest News, Top of the deck

A Thursday meeting of Nagasaki prefectural assembly heard that the fund raising required for opening a casino complex in that Japanese metropolis will be circa 25 percent higher than the capital cost mentioned previously, namely JPY438.3 billion (US$3.8-billion), rather than JPY350.0 billion.

According to information from the prefectural government and its preferred private-sector partner, Casinos Austria International Japan Inc, the development phase will cost JPY351.8 billion, and other costs – including working capital – will push the fund-raising element to the JPY438.3-billion level.

The equity portion will be JPY175.3 billion, with 60 percent of the equity from Casinos Austria International Japan, 30 percent from other foreign companies, and 10 percent from Japanese companies. Casinos Austria International Japan said it expected to close the financing in April, according to GGRAsia’s Japan correspondent.

The debt portion of funding will amount to JPY263 billion. No further details were given on the funding.

Annual net profit for the resort (pictured in an artist’s rendering) in 2031 is forecast to be JPY31.7 billion. If approved by the national authorities, the project is expected to launch in the autumn of 2027.

The deadline for local governments in Japan to submit to the national government a bid to host an integrated resort (IR), is April 28.

Thursday’s update mentioned the scheme’s promoting entity would be called Kyushu Resorts Japan, symbolic of the Japanese island where Nagasaki is located.

A spokesperson for Nagasaki prefecture’s Integrated Resort Promotion Division confirmed to GGRAsia on Thursday that public hearings on the community’s District Development Plan for a resort will be on March 28 and 30.

Business partners mentioned on Thursday for Casinos Austria’s resort included the Hyatt hotel brand; the Red Bull drinks brand; Hotel Sacher; Swarovski; Japanese printing conglomerate Toppan; and JTB, the largest travel agency brand in Japan.

Nagasaki’s IR is to be located at the Huis Ten Bosch theme park in Sasebo, within the prefecture.

On Friday, the prefecture will have the third meeting of its IR expert panel to discuss the updated draft of Nagasaki’s District Development Plan.