MGM Resorts Partners with Orix, Focuses on Osaka Casino License
MGM Resorts International plans to pursue an Osaka casino license in this year’s battle for one of three casinos licenses from the Japanese government. Osaka is the largest Japanese prefecture to seek a casino license.
Longtime MGM Resorts CEO Jim Murren said during a recent earnings report, “We just recently opened up an office in Osaka. We’ve committed now to the mayor and to the governor of Osaka. MGM has adopted an Osaka-first strategy. We are focusing our considerable resources on Osaka.”
The plan is to build a $8.5bn (£6.4bn) integrated casino resort on 60 hectares of land on Yumeshima Island. MGM Resorts would like to gain approval for the casino project in early 2020 and have its grand opening sometime in 2024.
That would give the region a casino-resort in time for Osaka to host the World Expo, which comes to the city in 2025.
Melco Resorts and Las Vegas Sands.
Before MGM Resorts can make those plans, though, it will have to overcome stiff competition from two world-class competitors: Melco Resorts & Entertainment and Las Vegas Sands Corporation. Melco Resorts is a Chinese competitor that Jim Murren knows well from Macau, where Melco owns City of Dreams, Altira Hotel, Studio City, and Morpheus.
Las Vegas Sands, which has mega-resorts in Las Vegas, Macau, and Singapore, is the largest casino company in the world. All three companies have experiencing in the Asia gaming market and the resources to commit $5 billion to $10 billion to an Osaka integrated resort. Most believe all three will compete for the Osaka license.
MGM Resorts Partners with ORIX
To help the bid, MGM Resorts signed a partnership deal with ORIX, a financial services company based in Tokyo. Orix was founded as the Orient Leasing Co. Ltd. in 1964, but it changed its name to Orix Corporation in 1989.
Orix Corporation has delved into a variety of fields, including investment and retail banking, lending, leasing, real estate financing and development, rentals, life insurance, venture capital, commodities funds, and securities brokering.
It is the real estate development wing of the company likely to be key to MGM Resorts’ bid to secure an Osaka casino license. Over the years, the company has expanded into 64 different countries worldwide. With operations in Asia, North America, the Middle East, and North Africa, it is a massive financial company which should improve Japanese officials.
MGM Resorts Hires Brian Sandoval
MGM Resorts also recently hired former Nevada Gov. Brian Sandoval (R) as a lobbyist on behalf of the Osaka casino license. As a two-term governor of Nevada, Brian Sandoval is a familiar with all aspects of the Las Vegas casino industry — and thus the global gambling industry as a whole.
Gov. Sandoval signed several key gaming expansion bills during his time in office. He was co-founder of the Multi-State Internet Gambling Association (MSIGA), while also was a strong supporter of legalized online gambling in the United States, even in the face of the opposition of his lieutenant, former Nevada Attorney General Adam Laxalt, to online gambling.
Brian Sandoval also signed bills which had to do with eSports betting, virtual sports betting, and skill-based gaming machines. He was key in building a $1.8 billion modern football stadium for Las Vegas, which was the reason the city could lure the Oakland Raiders to move to Las Vegas. Gov. Sandoval should bring the same energy to securing a casino license for MGM Resorts.
About Yumeshima Island
After Yumeshima Island flooded in the wake of Typhoon Jebi, some locals questioned the wisdom of building an integrated casino-resort on the island. Osaka Prefecture Gov. Ichiro Matsui and Osaka Mayor Hirofumi Yoshimura both faced questions about any new resort flooding during a similar crisis, but Matsui and Yoshimura argued there are no significant risks of flooding.
Governor Matsui said, “The island of Yumeshima is higher above sea level than Kansai airport, so there is no problem. Yumeshima is nine meters above sea level, so there would be no flooding at all.”
Wakayama Casino License Update
In nearby Wakayama, Prefecture Gov. Yoshinobu Nisaka plans to lobby for one of the three casino licenses. Nisaka faces a re-election vote in November and the casino license is expected to be one of several key issues. Nisaka is thought to be a heavy favorite to win re-election.
“Only three locations will be chosen, and Osaka’s business community is quite aggressive in their activities to invite a casino.”
Unlike the Osaka bid, the Wakayama bid might have to overcome dissension between the prefecture and city governments. Wakayama Mayor Masahiro Obana, who won his own re-election campaign last year in a landslide, welcomes a casino — but only under strict conditions.
Mayor Obana wants a casino, but one restricted to foreign gamblers only. Governor Nisaka wants a casino which is open to both foreigners and domestic Japanese players.