On Tuesday, the Japan cabinet confirmed that a second round of applications for integrated resort (IR) licences will begin in 2027.
The bidding window will open on 7 May and last six months, until 5 November. During that period, local governments may apply for one of two licences not awarded during the first round of bidding, which ended in 2023.
In 2018, Japan enacted the Integrated Resort Implementation Law, authorising up to three IRs and legalising casino gambling within those properties. Based on their success, a second phase of development was planned to introduce seven more resort properties.
The late prime minister Shinzo Abe promoted IRs as a way to increase foreign investment and tourism. His protégé, current prime minister Sanae Takaichi, is said to also favour the developments. Following her election last October, Takaichi reportedly ordered Tourism Minister Yasushi Kaneko to “promote … IRs and realise attractive stay-type tourism” in Japan.
Rocky road to integrated resorts
When Japan first legalised IRs, analysts predicted market revenue of up to $40 billion per year at maturity. That would have surpassed even Macau, which generated gross gaming revenue of $30.9 billion last year.
Cooler heads called for a more modest but still ambitious opportunity: $19 billion annually in gaming and $6 billion in non-gaming. Global operators including Wynn, Caesars, Genting and Melco all wanted in. Sheldon Adelson, late head of the Las Vegas Sands Corp, declared he would invest “whatever it takes” to be first on the ground in Japan. But public opposition, burdensome regulations and Covid-19 killed the momentum.
Ultimately, only Osaka and Nagasaki submitted IR bids, and lawmakers approved just one: MGM Osaka. A project of US-based MGM Resorts International and its domestic partner, Orix Corp, the $10 billion resort is on track to open in 2030. According to Bloomberg, it could reap GGR of $5.9 billion per year when it opens.
“No one is more happy than I am to see this happen,” said Ed Bowers, CEO of MGM Resorts Japan, at the groundbreaking last April. “It’s not been an easy road and we will continue to see challenges until and after this opens.”
The Nagasaki plan, led by Casinos Austria, failed due to financing concerns.
Potential Phase 2 candidates
In Phase 2 of applications, Nagasaki Prefecture is expected to take a second bite of the apple. Aichi Prefecture is also expected to apply for a licence. Local media reports that Aichi Governor Hideaki Omura supported an IR proposal in the first round, but bowed out amid pandemic disruptions.
Hokkaido Governor Naomichi Suzuki also passed on the initial opportunity due to environmental concerns, but is now considering the benefits.
“Circumstances are changing,” he said in 2025. “We view IR as a potential project that could contribute to Hokkaido’s development by attracting private investment and boosting tourism-related spending.” The prefecture’s presumed partner is Hard Rock International, which shared renderings of a proposed Hard Rock-branded resort, complete with guitar-shaped hotel, back in 2019.
Jim Allen, chairman and CEO of the US-based tribal operator, said the development would “not only bring economic benefits to the local community, but also act as a gateway to learn more about the wonderful heritage of Japan and all that it has to offer”.
Marjorie Preston
Marjorie began her gaming career in 2007 and has focused on Asian gaming markets since 2020. Outside of work, she writes about travel and film and plays the drums.
Original article: https://igamingbusiness.com/casino/its-official-japan-ir-bidding-to-resume-in-may-2027/
