There is likely to be a “long process” in order to set up a Japanese casino industry even after the passage of necessary legislation, but the political environment seems encouraging, said on Thursday a senior industry executive.
Matt Maddox, president of Wynn Resorts Ltd, made the comment during the firm’s third-quarter earnings call with analysts on Thursday. Mr Maddox said regarding Japan, and following the election victory five days earlier of the Liberal Democratic Party (LDP) led by Shinzo Abe: “It looks like the political environment is continuing to be – is – stable now after this last election. And we think that there is gaining momentum for the IR [integrated resorts] legislation for some time next year.”
Jim Murren, chairman of MGM Resorts International, another U.S.-based firm chasing a Japan licence, said in a recent presentation in Tokyo it could be 2025 at least before a casino resort opens in that country.
Steve Wynn, founder and chairman of Wynn Resorts, indicated in an interview with Japan’s Nikkei Asian Review newspaper published in September that Tokyo, Osaka and Yokohama (pictured) were examples of Japanese cities that could support the “highest quality” of staff and supplies necessary for him to build a new casino resort.
Wynn Resorts already has a Macau casino operation via its Wynn Macau Ltd unit.
Consultancy Global Market Advisors LLC had said in a Tuesday memo that Mr Abe’s poll success had confirmed a so-called “supermajority” in the lower house of the country’s parliament for the LDP and its political allies.
GMA said this might spur passage of a legislative bill to address problem gambling – possibly as early as this year during an extraordinary session of parliament possibly commencing on November 1. That legislation would be followed in likelihood next year by the IR Implementation Bill, said GMA. The latter piece of legislation would provide a framework for the industry.
But GMA warned that regional politics could interfere with such a parliamentary legislative timetable.
Wynn Resorts’ Mr Maddox noted on Thursday: “We also know that once legislation is passed, there’s a long process of setting everything up. So we’re monitoring it carefully and spending time there and developing relationships. And over the next couple of years… we’ll understand the potential opportunity.”
Las Vegas Sands Corp, which already has Asian casino operations in Singapore as well as Macau, is also a suitor in the Japan market.
Sheldon Adelson, chairman and chief executive of Las Vegas Sands, told analysts on his firm’s third-quarter earnings call on Wednesday regarding the prospects for legislation in Japan: “We’ve been optimistic for many years about that. Now it looks better than ever… We’ll get the Implementation Bill – but who knows [precisely] when?”
In other developments, it was reported on Thursday that Deutsche Bank AG was relaunching its Japan real estate lending business, after scaling it down following the global financial crisis of 2007 to 2008.
The institution cited a factor as the likelihood of growing demand for property transactions in the wake of casino legalisation and growth in inbound tourism.
“We are definitely bullish on the continued strength of the tourism market,” said Geoff Crum, head of real estate at the bank’s global credit trading unit in Tokyo, as quoted by Reuters news agency in an interview.
Opportunities for lending to hotel investors were likely to increase as demand for tourism in smaller Japanese cities was expected to grow, said Mr Crum. Opportunities for real estate lending could grow further if casinos are eventually introduced in Japan, he added.
Las Vegas Sands and MGM Resorts had previously suggested a single resort in Japan could cost as much as US$10 billion. “Even at relatively low leverage rate, that’s a huge amount of debt capital,” Mr Crum reportedly said.
Jul 07, 2022Starting from Friday (July 8), two more hotels at major Macau casino resorts will be used for Covid-19 quarantine purposes. It will double the number of large gaming-resort hotels on Cotai that are...
”Linda’s leadership throughout the many phases of our development in Macau has been important to our success. She will work with Ian to ensure a smooth transition”
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