The market has reacted to Monday’s news that Yokohama would formally bid to host one of Japan’s first integrated resorts by boosting the share price of Keikyu (Keihin Electric Railway) by 3.0% to a high of JPY1,996 – its highest level since October 2018.
Keikyu established a new project team in 2014 in consideration of a potential IR and it seems that individual investors are buying in because they believe there will be significant benefits from a successful bid. Primarily the market has expectations that Keikyu, which runs a direct connection from Haneda to Yokohama, will enjoy significant profits from a boost in overseas visitation.
Yokohama mayor Fumiko Hayashi is set to make an official announcement that the city will bid for an IR, and will submit a revised budget proposal of approximately JPY300 million to the regular city assembly in September.
In order to promote an IR, the number of staff responsible will be increased and an IR Promotion Office will be established.
Mayor Hayashi initially took a positive view of an IR, stating it was necessary for sustainable development, but in 2017 her approach became more cautious before her election as mayor, repeatedly insisting nothing was confirmed.
While she put on a cautious facade, the city itself has collected development concepts from interested operators, made them public and held public briefings. It is estimated that the economic effect could be between JPY770 billion to JPY1.65 trillion annually.
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