Analyst: LV companies in Japan lead
A top gaming industry analyst said two Las Vegas companies could be the first to build casinos in Japan.
Las Vegas Sands Corp. and MGM Resorts International appear to have the inside track to be selected to build two of Japan’s first integrated resorts and casinos at Osaka and Yokohama, senior equity analyst Dan Wasiolek of Morningstar Inc. said Monday in a report to investors.
Caesars Entertainment Corp. and Wynn Resorts Ltd. also have hopes for Japan.
Wasiolek said he expects the Japanese to consider operating experience in stringent regulatory environments, balance sheet strength, partnership experience, appreciation of Japanese culture and experience in meetings, incentives, conventions and exhibitions to be considered when concessions are awarded.
In the report, Wasiolek said Sands and MGM are stronger than Wynn in the meetings industry. Morningstar does not monitor Caesars.
Japan legalized gambling in late 2016, and receiving
JAPAN Projected combined gaming revenue for the first two properties to open in Japan, in 2025 and 2026.
a license to develop casino resorts there is viewed by the gaming industry as one of its most lucrative opportunities in history. After the first two properties open in 2025 and 2026, projected annual revenue is at $26 billion combined.
Wasiolek projects that Las Vegas Sands, which operates The Venetian, Palazzo and the Sands Expo & Convention Center on the Strip, is positioned to win the concession in Osaka.
“We see Las Vegas Sands as most likely to win one of the two urban gaming licenses, due to its strong resort experience in Singapore and Las Vegas, where we believe regulation is more stringent than in Macau and the Philippines, and where problem gambling and crime issues have been controlled,” Wasiolek said in the report. “Additionally, Las Vegas Sands has shown itself to be a valued partner in Macau where it has invested $13 billion since 1999.”
Sands spokesman Ron Reese told the Review-journal on Tuesday that
the company is “happy to be recognized, but we’ll let Japan make the ultimate determination.”
Wasiolek projects that MGM, with 10 Strip resort properties, is in line to open a resort in 2026 in Yokohama, the second-largest revenue opportunity.
“MGM Resorts is well-situated to receive a concession based on its leading position in Las Vegas, a market where gambling issues and crime have been well-controlled as well as its experience working with partner companies, while also displaying a strengthening balance sheet,” he said.
MGM spokesman Brian Ahern told the Review-journal Tuesday that the company has had a team in Japan “for several years” becoming immersed in Japanese culture, history and values.
After regulators are chosen, local governments in the regions where casinos would be located would issue requests for resort proposals, probably in the first half of 2020, with licenses approved by the end of that year.
“Wynn Resorts is very focused on Japan as a development opportunity and very active in the major cities of Osaka, Yokohama and Tokyo,” a company
spokesman said in an email.
“Chris Gordon, who leads our development team, and CEO Matt Maddox are both in Japan this week,” he said.
Jan Jones Blackhurst, executive vice president of government relations and corporate responsibility for Caesars, said the company’s track record on responsible gaming and partnerships with local entities should serve the company well.
Two pieces of legislation relating to preventing addictive gambling behavior and the implementation of the industry were approved in July.
“The dynamics are completely different in Japan than in any other Asian location,” Blackhurst said. “We take our corporate responsibilities (on problem gambling) very seriously and I don’t think there’s any company that does it better than we do.”
Blackhurst also said she expects the company’s record of developing decades-long partnerships with locally based entities and the company’s visitor database will be appealing to Japanese decision-makers.
The Review-journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson.