Inside Asian Gaming

INSIDE ASIAN GAMING SEPTEMBER 2018 30 promotion when they may not win the licenses. But some operators keep laying chips on the line. “MGM will continue to put the case for tourist-oriented IRs in Japan,” Bowers says. The company already has sponsored cultural exchange events in both Japan and the US, notably kabuki at the Bellagio fountain in Las Vegas and Blue Man Group in Osaka. “We spare no effort to contribute to promoting to the public what an IR is,” Galaxy Entertainment Japan General Manager Satoshi Okabe says. “I am invited by stakeholders to give lectures from Hokkaido to Okinawa.” Localities have their own tasks while the national government works on regulations. “First of all, the prefecture governor has to have firm consensus with the city mayor about participation in an IR,” Suganuma says. “Even with the strong responsibilities the prefecture has, actual operations will be conducted by the city.” FRONT RUNNER Osaka appears far ahead of rivals in terms of city and prefecture cooperation. There’s consensus around an IR site on Yumeshima island and a Request for Information (RFI) process took place in 2016. Osaka is presently vying to host World Expo 2025 on Yumeshima and IR development could provide accommodation and other supporting facilities, as well as a target date for completing at least some IR components. The expo decision is due in late November and some speculate Osaka could launch a Request for Concepts ahead of that date. For casino operators that want to be in Japan, first, “They have to look seriously at the law and decrees – not everybody has read or understood the entire version of the legal text – verify constraints and issues, and re-conduct business feasibility studies in detail with more precise evaluation on potential market,” Mihara, a faculty member at the Osaka University of Commerce’s Institute of Amusement Studies, says. “Now that the bill has passed, it’s more difficult to be all things to all people,” a casino executive speaking on background adds. “You can’t bid everywhere.” Operators are watching carefully whether the government will evaluate applications for all three licenses at the same time, as Macau did, or award the licenses in stages, as Singapore did. Mihara says that operators can bid for multiple locations, as long as jurisdictions permit it, though “it may not be a wise move to play with a number of local governments ... even if allowed, it may create a bad impression.” The partnership dance will also involve difficult choices. “In Singapore, originally the proposed partners were the leading local real estate developers. Why wouldn’t it be the same in Japan?” Spectrum’s Bromberg asks. “Possibly, there will be consortia that include the operator, financial source(s), a real estate developer and/ or a construction company.” Multiple partners can complicate equity sharing and decision making. Whatever the shape of the development groups and regulatory regime, Japan represents a brave new world. “Asia is unique from the way IRs exist on the Las Vegas Strip,” MGMResorts International Executive Vice President for Global Affairs Alan Feldman says. “Macau faced challenges with its IR initiative to produce world class architecture plus Las Vegas excitement. There’s a distinctly different challenge in Japan. There’s really nothing in the world today that you can point to that’s like it.” Osaka appears far ahead of rivals in terms of city and prefecture cooperation. There’s consensus around an IR site on Yumeshima island and a Request for Information (RFI) process took place in 2016. FEATURE IN FOCUS Aerial view of Yumeshima