GGRAsia – Orix initial investment for Osaka IR to be about US$1.8bln

Orix initial investment for Osaka IR to be about US$1.8bln

Nov 05, 2021 Newsdesk Japan, Latest News, Top of the deck

A senior executive from Orix Corp, one of the Japanese partners of MGM Resorts International in the proposed Osaka casino resort development, says the two will each hold 40 percent equity in the scheme, with a collection of companies, some from the local Kansai region, taking the remaining 20 percent.

Hitomaro Yano, executive officer at Orix, also said his firm’s initial investment in the JPY1.08-trillion (US$9.50-billion) scheme (pictured in an artist’s rendering), would be circa JPY200 billion, i.e., about US$1.76 billion.

He was speaking on Thursday as reported by Bloomberg in Japan, after publication of Orix’s results for the quarter ending September 30.

Mr Yano added that Orix’s initial contribution would be covered via cash on hand.

About half the total cost of the Osaka integrated resort (IR) – as large scale casino complexes with meeting and tourism facilities are known in Japan – would be funded by non-recourse loans, he further stated. Non-recourse loans are a type secured by collateral, typically property.

According to Bloomberg, parties to the 20 percent interest in the Osaka scheme include: France’s VINCI Airports, which has a management contract for Kansai International Airport according to VINCI’s corporate website; Kansai Electric Power Co Inc; Kintetsu Group Holdings Co Ltd; Panasonic Corp; and other Kansai-affiliated companies.

In late July, the Osaka authorities mentioned the likelihood of an initial opening for the IR to be at some point from 2028 at the earliest, to 2030.

The Japanese government opened on October 1 the application period for local authorities to pitch as host for a casino resort, and announced the weighting it will give when scoring such requests.

Under the liberalisation programme, up to three resorts will be permitted nationally in a first phase. Currently, only three local communities are in the running for hosting a large-scale IR. They are: Osaka, Nagasaki, and Wakayama.