GGRAsia – Shinhwa World to add condos, villas amid recovery: exec

Shinhwa World to add condos, villas amid recovery: exec

May 26, 2022 Newsdesk Latest News, Rest of Asia, Top of the deck

Jeju Shinhwa World, a leisure complex with a foreigner-only gaming venue called Landing Casino, on the South Korean holiday island of Jeju, aims to add 100 more units of ‘Somerset’-branded condominium accommodation and villas, in a second phase of development, a resort executive told GGRAsia during the latter’s site visit this month.

The timetable and cost for that work is still to be announced, said the executive.

Jeju Shinhwa World (pictured) is operated by Hong Kong-listed Landing International Development Ltd, and opened in March 2018. It currently has 2,062 hotel rooms. They consist of 615 rooms under the Landing Resort brand; 533 rooms under the Shinhwa Resort brand; 572 rooms under the Marriott brand; and 342 rooms under the Somerset brand.

The executive – who asked not to be identified by name – said to GGRAsia that after a “dark” period, linked to travel and tourism restrictions associated with the Covid-19 pandemic, the resort expected “an automatic recovery of overseas tourism to Jeju”.

Visa-free access to Jeju for holders of certain passports will be restarted on June 1, after a more-than two-year pause.

Landing International reported a HKD1.06-billion (US$135.0-million) annual loss for 2021, but that was still halved from the HKD2.12-billion loss for 2020, the firm said in a filing in late March.

Pre-crisis, Jeju and its foreigner-only casinos, were popular draws for tourists from across the region.

The Jeju Shinhwa World executive suggested its business model – compared to some other casino venues in South Korea – was “more like Las Vegas than Macau,” in terms of its emphasis on targeting those players “who want both casino and island resort”.

According to that executive, Jeju Shinhwa World – a 30-minute drive from Jeju’s airport – is the largest resort complex on the island. It has a theme park and a conference centre.

Another of South Korea’s purpose-built, large-scale resorts is Jeju Dream Tower. It is in Jeju city, and operated by Korea Exchange-listed Lotte Tour Development Co Ltd, offering a Grand Hyatt-branded hotel. That resort opened in June 2020.

On the South Korean mainland, the large-scale Paradise City gaming resort opened in 2016, and is promoted by Paradise Co Ltd, in partnership with a unit of Japan’s Sega Sammy Holdings Inc. It is located at a reclamation area in Incheon, near the capital Seoul.

Japanese competition

Regarding to the outlook for the South Korean casino resort sector, and any competition from Japan if it eventually builds integrated resorts (IRs) as they are known in that country, the Jeju Shinhwa World representative said: “As English and Chinese language skills are more prevalent in South Korea than Japan, Japan IRs might have some language infrastructure and service handicaps for foreign travellers,” if Japan wished to “compete against South Korean casino resorts”.

That executive added: “Both the South Korea national authorities and the Jeju local government are cooperative, with reasonable support for Shinhwa World so far, such as road infrastructure, as it is the largest foreign investor to the hospitality industry in the country, contributing to local society, as well as providing employment opportunities to locals”.

The recovery period for Jeju tourism coincides with the nation getting new leadership. Yoon Suk-yeol took office as the country’s president on May 10, following an election in March.

The Jeju Shinhwa World executive said the resort looked forward to the new government having greater “concern” for “tourism industries”, following the sector’s struggles amid Covid-19. The executive added they hoped the new administration would consider amending tourism-related laws and policies to make them “more friendly” for businesses in that sector.

An example, would be if the national government could reduce the levy South Korean casinos must pay to the country’s Tourism Promotion and Development Fund, said the executive.

Any casino business with sales revenue over KRW10.0 billion (US$7.9 million), is mandated to pay 10 percent of that to the fund. Jeju casinos must also pay the levy on any incentives they might pay to junkets.

Payment of that levy due from casinos for the 2021 trading period has been deferred to 2023, the Ministry of Culture, Sports and Tourism said in a recent announcement about industry performance for 2021.