GGRAsia – One year delay to Osaka IR launch reasonable: governor

One year delay to Osaka IR launch reasonable: governor

Sep 06, 2023 Newsdesk Japan, Latest News, Top of the deck

The governor of Osaka prefecture says that a one-year delay to the opening there of an integrated resort (IR) with casino, to circa autumn 2030, is “reasonable considering the central government had taken one year to give the approval for our IR District Development Plan.”

Hirofumi Yoshimura (pictured in a file photo) added that it was now hoped that a revised draft agreement for the IR’s development – a document announced on Tuesday and including the revised timetable and JPY1.27 trillion (US$8.6 billion) in initial investment, up 17.6 percent on the JPY1.08 trillion previously mentioned – could be approved by the national government before the end of this month.

Governor Yoshimura’s comments were made also on Tuesday, after the authorities in the Japanese metropolis of Osaka confirmed the revised draft agreement. His remarks were carried by local media outlets.

The draft agreement is between Osaka prefecture and city on one side, and on the other, their private-sector IR partners, led by casino operator MGM Resorts International and Japan’s Orix Corp.

The Osaka authorities plan to submit soon the revised agreement – known as the draft compact – to the Ministry of Land, Infrastructure, Transport and Tourism.

According to information collated by GGRAsia’s Japan correspondent, the draft compact includes the right for the IR developer to terminate the agreement in the event certain business conditions are not in place.

They include matters concerning the tax regime for the project, fundraising, and land improvements regarding the site at Yumeshima, an artificial island in Osaka Bay that will host the MGM Osaka casino resort. There have been ongoing discussions about improvements to the land, according to reports in Japanese media.

According to the draft compact, should the developer’s side exercise the right to terminate the agreement with the Osaka authorities, it would not need to pay either damages or fees.

The revised draft compact publicised on Tuesday says construction of the IR is due to start in spring 2025.

From April to October that year, Yumeshima is due to host a large event called ‘Expo 2025 Osaka Kansai, Japan’.

The IR site is due to cover 49 hectares (121 acres), according to the draft compact. An additional 6 hectares has been earmarked for possible expansion of the resort at a later date.

Governor Yoshimura had said in mid-July it would be difficult to open the IR in a 2029 time frame previously mentioned. He said one factor was the time it had taken the national government to approve Osaka’s plans.

The IR District Development Plan for Osaka was approved in principle on April 14 by the national authorities, having been submitted to them in April 2022.