Mayor reveals plans
Yokohama mayor Fumiko Hayashi has confirmed that the second most populated city in Japan is hoping be granted one of three integrated casino resort licenses.
The other regions and cities that are officially vying for one of the three licenses are Wakayama, Nagasaki and Osaka. Casino resorts only became legal in Japan at the end of 2018.
Speaking about the city’s plans to obtain one of these licenses, Hayashi said:
We must look to Yokohama’s future, the 20 to 30 years ahead.”
The site chosen in Yokohama to host the resort is Yamashita Park. This is close to the popular tourist attraction of Yamashita Park. The goal would be to open the casino resort by the latter half of the 2020s.
Potential of these resorts
With a population of 128 million and access to the wealthy market of Asian gamblers, there is stiff competition for these lucrative Japanese licenses.
Due to long negotiations on the issue, none of the casino resorts will be ready to open its doors in time for the 2020 Olympics in Tokyo.
According to some analysts, the casino sector could be worth about $20bn annually. This is why there has been significant interest from most major global casino companies.
Casino resort requirements
Regular commercial casinos only became legal in Japan in 2016. Therefore, the regulatory framework has not really been tested. For those looking to casino resorts, they have to follow the requirements which got approval by the legislature on March 26, 2019.
The casino floor itself can only be 3% of the total resort area
Certain boxes need ticking in order to receive one of the three casino resort licenses. One of the main focuses is being in an area that is easily accessible to tourists. The casino floor itself can only be 3% of the total resort area. There also needs to be a convention center and an exhibition center on each site.
There are curtailments on how these casinos can advertise. They can only promote themselves in cruise ship terminals and international terminals at airports in Japan.
Competitive bidding process
Many global casino companies have been positioning themselves to try and obtain one of the operating licenses for a casino resort in Japan. Osaka is seen as being one of the bankers for receiving a license. They are playing host to the World Expo in 2025, which will bring massive numbers of visitors to the area.
MGM Resorts International, for example, is banking on Osaka getting a license. The casino company has set up offices in the city and they are partnering up with local businesses already.
According to city officials, some of the casino operators are willing to invest up to $12bn in a casino resort. Analysts from Morgan Stanley say that due to this extremely competitive bidding process, the size of the total investment will continue to rise.
Las Vegas Sands is hoping to operate one of the casino licenses, but they believe that Yokohama is too far away from a major metropolis. Therefore, they do not see Yokohama receiving one of the licenses. Instead, Las Vegas Sands is focusing on a potential Osaka license.