Japan has passed a landmark law to legalise Integrated Resorts (IR) with casino component, a move that could generate about US$10 billion in net profit yearly, according to an estimate by Daiwa Research Institute.
Even though these resorts would only be opened at the earliest post-Olympics in 2022 to 2023, major gaming players Sands Las Vegas, Wynn Resorts Limited and MGM Resorts International are already eyeing a slice of the pie.
Japanese Prime Minister Shinzo Abe says integrated resorts would encourage tourism, shopping and entertainment spending, boosting the economy in the process.
“These integrated resorts will offer hotels, MICE (Meetings, incentives, conferences and exhibitions) facilities and retail opportunities for visitors,” says Akagi Takeshi, Head of Research in Japan.
“MICE facilities are especially limited in Japan. Having the space and capacity to hold them may also help stimulate more business and innovation in the country as more business and leaders gather here.”
Cities from Rusutsu in Hokkaido Sapporo to Yokohama in Greater Tokyo and Osaka are said to be bidding to develop the integrated resorts.
“Regional governments will be eager to have integrated resorts in their cities as it means jobs and opportunities,” says Takeshi. “There will be significant impact for real estate, especially for the hotel and retail sectors when construction begins. The office sector could also see an indirect effect spurred by corresponding economic growth.”
The bill passed in December 14 gives the Japanese government a year to develop its plans for the integrated resorts and tackle issues from licensing operators to social ills associated with gambling.