Inside Asian Gaming

INSIDE ASIAN GAMING JUNE 2018 46 will determine “whether that model is going to be able to justify a return on investment for what will be massive investments,” according to Eric Landheer, Executive Director of Summit Ascent Holdings – the Hong Kong-listed company that runs Tigre de Cristal in Vladivostok, Russia. Landheer added that some of the most important aspects that the legislation has not yet tackled include credit and insurance details, the full taxation structure and whether junkets will be allowed in the country. JAMES BOND ELEGANCE Despite the legal uncertainty, Japan provides a huge revenue opportunity if operators are able todrawan accurate profile of potential customers and take advantage of underutilized infrastructure. In this regard Tash points to the pachinko segment, noting that he sees “an opportunity” in the sector despite pachinko’s generally negative connotations. In fact, Tash believes it is only a matter of time before pachinko – which generated an estimated US$30 billion in revenue last year despite declining player numbers – finds its way onto Japan’s IR floors. “When you walk into a pachinko parlour it is an overwhelming assault on the senses with lights and noise – it’s completely different from the typical table games experience, the traditional James Bond FEATURES style casino where there is a sense of elegance,” he said. “If pachinko can generate this much volume from players in such an unattractive environment, imagine what it can do when they are able to play in an integrated resort?” Tash sees pachinko maintaining the status quo away from Japan’s IRs during the early years before gradually claiming a space on casino floors in the future, as “they are naturally targeting the same people.” “If pachinko can generate this much volume from players in such an unattractive environment, imagine what it can do when they are able to play in an integrated resort?” – Alidad Tash WHILE ALL EYES ARE FOCUSED ON JAPAN, there is movement at the station in Russia where the Special Economic Zone in Vladivostok is set to become a “mini-Macau.” So says Summit Ascent Holdings Executive Director Eric Landheer, whose company owns and operates the region’s first IR, Tigre de Cristal. According to Landheer, Vladivostok will be home to “six to eight IRs within the next five to 10 years” due to the SEZ’s incredibly generous tax rates and proximity to the largely untapped northern China market. He suggested that the ongoing success of the region “needs to be inspired by further mass growth” but predicted enormous benefit would be gained from the future “cluster effect, which we know has been proven to work both here, in Macau and other places.” The cluster effect refers to the added attraction for visitors of clustering multiple IRs together, as is the case in Las Vegas and Macau. “I don’t expect to see a Macau and I don’t expect to see a Japan or even perhaps a Singapore, but you could say I expect something like a mini-Macau,” Landheer said. RUSSIA’S “MINI-MACAU” Diamond Fortune Holdings broke ground on what is scheduled to become Vladivostok’s second IR, the US$900 million Selena World Resort & Casino, last June with an opening date of mid-2019, while NagaCorp expects to open Phase 1 of its Russian IR – which will boast a casino, conference space and 279 hotel rooms – sometime in 2019. Tigre de Cristal is expected to unveil plans for its second phase in July or August of this year.