G3 INSIGHT JAPAN
INTEGRATED RESORTS
Alternatively, if you look at Nagasaki, which is about two hours from the nearest international airport, which is a long way for an IR. Tere is a much closer domestic airport, but that’s not able to be upgraded for international carriers.
Nagasaki is close to South Korea, but as the bids have made clear, the IRs are not being targeted at Koreans – it’s the Chinese market they’re most interested in attracting to Japan. It is beneficial that South Korea’s casinos currently only allow foreigners to play in their domestic casinos, but as more players leave to play in Japan, I can see the South Korean government changing those rules.
Will domestic players in Japan feed the Integrated Resorts or does tourism have to play a large role in keeping the engines stoked?
I think the Japanese domestic market is very interested in casino gaming. Pachinko plays the part of slot machines in Europe or AWPs in the UK. Te Japanese are very much tables players. If
Woods). Te population is very small, as you’d imagine, and not enough to sustain a casino.
Having said that, Wakayama would also have difficulty sustaining a casino on its own. However, there is a very large population base in neighbouring Osaka and the Nara prefecture in the middle of Japan (pop. 1.32m).
Wakayama is also located on the spiritual path that every Japanese person is supposed to take once in their lives (the Koyasan Choishi-Michi trail is an ancient path that pilgrims have travelled for more than 1,200 years).
I’m much more confident in Wakayama’s prospects of winning a bid than I am Nagasaki – and I do think that only one of the two will emerge with a licence at the end of the process.
If the government does keep back a licence, is it simply to keep Tokyo’s options open?
“It is commonly believed that Tokyo does want an IR, but it also doesn’t want to be the first. My view is that one licence will be held back so that Tokyo can put in a bid once the other two IRs are established. In the unlikely event that Tokyo withdraws completely, in that case the government is likely to choose Hokkaido, which also hasn’t closed the door.” Jonathon Strock, JS Consultancy
you ask operators in Macau, they all have regular Japanese table players at their resorts. Over half of South Korea’s customer base is from Japan, Philippines is very high too. Tat said, the intention of the government was to drive tourism to Japan. What I think we will see in reality is a 60/40 split, local versus international, because there is so much pent-up demand in Japan.
Can Wakayama and Nagasaki feed from a local base of players?
A lot of play will be drawn to Osaka, but its IR is likely to open at least three years after the other locations have opened their doors, with Wakayama poised to open in 2027. Tis means that the local Osaka market will visit Wakayama, those from Tokyo too. It is more complicated for Nagasaki. Te international airport in Fukuoka, which is two hours away. Tere is no natural population. We call it the Nagasaki bid, but in fact it is the prefecture of Nagasaki, not the city of Nagasaki.
Te location of the IR is the small town of Huis Ten Bosch in Sasebo, Nagasaki (which is also the location of a theme park that recreates the Netherlands by displaying life-sized copies of old Dutch buildings and translates as House at the
P40 WIRE / PULSE / INSIGHT / REPORTS
In most democratic countries you have elections and then winning party gets to govern the country for a set period of time. In Japan, there has only been one party ruling the country since 1945. Due to this one party system, Japan is a country in which every must agree, and until they all agree – nothing gets done.
Te background to the Tokyo bid is that the city has been hesitant in bidding for a licence. Te Governor of Tokyo, Koike Yuriko, is the ex- Chairperson of the Liberal Democratic Party, and for political reasons has been reluctant to back Integrated Resorts in Japan due to her higher ambitions.
It is commonly believed that Tokyo does want an IR, but it also doesn’t want to be the first. My view is that one licence will be held back so that Tokyo can put in a bid once the other two IRs are established. In the unlikely event that Tokyo withdraws completely, in that case the government is likely to choose Hokkaido, which in this electoral cycle has said it isn’t interested in an Integrated Resort, but hasn’t closed the door. If a licence is still available, then Hokkaido could put in a bid in five years time. However, it would require Tokyo to decline the bid as it would have priority.
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