As bidding war for Japan's first casino resort license heats up, which region will win?

newsonjapan.com -- Dec 11

Ever since the Japanese authorities announced last year that they would be opening up bidding for the country's first casino licenses, there has been furious speculation over where will become "the Macau of Japan".

The move, which widely took Japan-watchers by surprise, given the near-total absence of land-based casino gambling in the country, is motivated in part by a desire to prevent an economic slump following the conclusion of the 2020 Olympics in Tokyo.

A total of three licenses will eventually be given out for so-called 'integrated resorts', a term used to describe a hotel and entertainment venue that also includes a casino. Given the obvious revenue opportunities such a license represents, a number of cities and prefectures have been making moves to secure the first license for themselves.

The arrival of casino resorts to the Chinese semi-autonomous province of Macau is widely credited for transforming the former backwater into one of the wealthiest regions on the planet, and it's clear that certain Japanese prefectures are hoping to see similar results in their local economies.

So far the Osaka, Wakayama, and Nagasaki Prefectures have thrown their hats into the ring, whilst Tokyo, Hokkaido, Chiba City, and Yokohama City have also expressed interest in working with casino developers. While all of them will likely be focused on the economic benefits of increased tourism stemming from becoming a casino destination, some may also be considering the potential revenues from local usage.

Although the licenses will be granted on the basis of attracting tourist revenue, it is no secret that online casino gaming, known locally as online kajino games, is immensely popular in Japan, given that they afford players with the chance to play all of the latest slots and table games. It is believed that local residents will be charged a fee to enter any casino, whilst tourists will be able to go for free. However, the popularity of casino games in Japan suggests that locals may be happy to oblige.

A key factor in determining which prefectures and cities will be granted a license will be the willingness of major international developers to work with them. So far it has been confirmed that the US casino conglomerate MGM is focusing its attention on Osaka, whilst Sands and Melco have publicly committed to Yokohama. Meanwhile, Wynn Resorts has promised to build "the world's biggest casino" in either Tokyo, Yokohama, or Osaka.

None of the other contenders have received a public pledge of support yet, but things will likely change quickly if it looks like any of them will be granted the coveted license. Yokohama and Osaka seem like natural choices, given their popularity as lifestyle and entertainment destinations, as well as both cities' long association with sports and gaming.

Tokyo, as the capital and recipient of the greatest number of tourists, will also be of intense interest to developers, but it's worth noting that the Japanese Gaming Authority may be reluctant to gift a license to a city that clearly doesn't need any help when it comes to extra revenue.

The first resorts are expected to break ground in 2020, which means the much-awaited decision will likely be announced in the coming weeks.