South Korea’s Paradise Co. and Japanese partner Sega Sammy Holdings plan to break ground in October on the first phase of a highly touted destination resort with gaming near Incheon International Airport and the capital of Seoul.
A 2017 opening is planned for Paradise City, as it’s known, and plans are to capitalize on China’s booming market in outbound tourism with a hotel, a casino with 120 table games and 700 slots and EGMs and an array of non-gaming attractions, including retail shopping, entertainment and MICE facilities.
“There will be more rich people in China, and they will need to travel. This is a megatrend,” Choi Jong-hwan, CEO of joint venture Paradise Sega Sammy Co., told Reuters.
Historically conservative when it comes social issues, South Korea’s political leadership has grown decidedly more friendly to resort-scale gaming as a means for driving inbound tourism and foreign direct investment. The government has designated several special economic zones (the area surrounding Incheon International among them) where casino development could be welcome and has green-lighted major projects led by Caesars Entertainment, which plans to open a casino megaresort near Incheon in 2018, and Genting Singapore on Jeju Island, a popular destination for Chinese tourists.
The number of Chinese visiting South Korea grew nearly 53% last year, and Paradise, the largest operator of the country’s foreigners-only casinos, has been a principal beneficiary. China has supplanted Japan in recent years the main driver of gaming revenues in the foreigners-only market, which consists of 16 casinos, five of them owned by Paradise.
Reflecting this trend, Mr Choi said Paradise City will rely on junket operators to bring in 20-30% of its business, compared to the current 5% at the company’s other casinos, and the marketing will be aggressive and tailored to highlight “Korean-ness”.
“Korea is a hot place right now. The main content that we will be showing to the Chinese VIPs will be Korean culture,” such as K-pop and local food, he said.
Investors like the idea and have bid up shares in Paradise more than sevenfold since the start of 2011, the year the Seoul-based operator sealed the partnership with Sega Sammy, a leading developer of pachinko machines in Japan. Last month, Paradise raised 285.8 billion won (US$276.54 million) in a sale of treasury shares.
South Korea’s total casino revenue was about $2.5 billion last year, split about evenly between the casinos restricted to foreign passport holders and the sole casino open to domestic play, the government-owned Kangwon Land, which is located in the far northeast of the country.
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