As the window slowly closes on casino legalization during the current session of the Japanese Diet, a fever seems to be overtaking the casino industry. Normally reasonable people are suddenly hyper-exaggerating their projections for gambling in the Land of the Rising Sun. Bloomberg News quotes MGM Resorts International CEO Jim Murren to the effect that MGM could make more money in Japan than in Macao. That’s difficult to envisage, but fair enough. However, gaming-analyst projections of a $10 million/year Japanese gaming market — the previous consensus — have gone out the window and giddily sky-high. CLSA Ltd. is projecting $40 million by 2025.
Murren’s not prepared to wait that long, saying, “In Japan, the market has potential of being $20 to $40 billion and there would be far fewer integrated resorts than in Macau.” Really? So soon? Former Japan Tourism Agency boss Hiroshi Mizohata predicts that visitation, sparked by casinos, will triple by 2030.
In any event, the casino bill has to be introduced in the Diet by June 2, as all legislation must be on the docket 20 days before adjournment. There’s an autumn extraordinary session, so everything isn’t necessarily riding on the next month or so. But the ruling Liberal Democratic Party has a less-than-enthusiastic partner in the New Komeito Party, which has ties to Soka Gakkai Buddhists, who oppose gambling. So the odds don’t look great.
In the event of legalization, both Wynn Resorts and Las Vegas Sands are contemplating IPOs as a means of financing their budget-busting projects. MGM is contemplating it, but playing its cards closer to the vest. Showing a bit of ankle, MGM did allow that it had talked to Panasonic and Sony as potential joint-venture partners. “The idea of partnering is critical and it’s not for the money. It’s more for the intellectual capital of what they bring to the relationships in terms of ideas, context of social sensitivity,” Murren said.
Interestingly, Steve Wynn is seeking expansion into Japan partly out of fear of a too-great dependence on Macao. Delegated as proxy for the great man, Wynn prexy Matt Maddox emphasized the compatibility between Wynn culture and Nipponese culture: “Japan is known for hospitality, high quality and precision. The culture of almost perfection here fits very well with Wynn and its details-oriented focus.”
Can’t argue with that.
liens on private residences (which was something of a cottage industry for struggling Foxwoods Resort Casino). State Rep. Deborah Ruggiero (D, left), the bill’s sponsor, said players and their family members are sometimes unaware that home sweet home is “being used as a bargaining chip at a blackjack table.” A related bill, slipped into the docket by Rep. Raymond Gallison (D), would allow Twin River Casino to raise lines of credit to $75,000, unsecured and free of interest. Twin River assures lawmakers it would never put a lien on anybody’s house but, according to the bill text, “The extension of credit to table game and video lottery players … is a vital customer service function that facilitates a gaming program’s long-term success.” If passed, it would enable Twin River to offer credit for the first time … and somewhat level the playing field with Mohegan Sun and Foxwoods.