After years of legal struggles, negotiations, and high expectations, the first Japanese Integrated Resort is on track to be developed in Osaka.
It has been a few years since Japan turned its attention to casinos to boost tourism and reinvigorate its economy. Among these, the Osaka IR is the first to receive full approval and commence the construction phase. The US casino Giant MGM Resorts International leads the Osaka IR project in collaboration with Orix, a Japanese financial services firm. The joint venture received approval from authorities in April 2022, with an anticipated opening date yet to be determined. However, all parties involved aim to have the resort operational by 2030.
However, significant changes to Japan’s strict gambling laws are required before gambling can be allowed on Japanese soil. Any amendments are unlikely to include the online casino law despite their popularity with Japanese players. Read more about this project and its implications for the region and the country.
Integrated Casino Resorts – from dream to reality
Japan hopes to boost its struggling economy by introducing Integrated Resorts (IRs), which combine casinos with hotels, conference rooms, and entertainment facilities. This initiative is designed to attract a global audience, increase tourism, and stimulate economic growth. However, legalizing these resorts has not been easy because of legislative debates, public skepticism, and concerns about social issues like gambling addiction. Despite these obstacles, proponents of the initiative argue that IRs could significantly contribute to economic revitalization, taking inspiration from successful models in Singapore and Macau.
In 2018, Japan passed the IR Implementation Law, which paved the way for developing Integrated Resorts (IRs) and marked a turning point in the country’s adoption of casino tourism as a key driver of economic recovery. The law established strict regulations for operating IRs and strongly emphasized measures to prevent gambling-related harms.
Several cities in Japan have been competing to host Integrated Resorts (IRs) since the law’s enactment. The selection process aims to identify the most promising locations for these profitable ventures. Osaka has emerged as the leading candidate and secured an agreement to open its Integrated Resort by 2030. This move places the region at the forefront of Japan’s tourism and economic expansion strategy.
Who will fund the Osaka IR project?
With the local economy not in the best places and prices surging across the globe, the question of who would fund the project was stringent. After months of negotiations and projections, the sides reached an agreement. MGM Resorts will cover 40% of the cost, Orix Corp will handle the other 40%, and a consortium of smaller local companies will cover the rest of the 20%.
Rising costs caused some setbacks in the project, forcing the team to agree on a new budget shortly after its beginning. To revive the Integrated Resort (IR) project, MGM has committed to investing $8.5 billion, $1.3 billion more than the estimated cost of ¥1.08 trillion ($7.2 billion). This significant increase highlights the project’s expanded financial scope.
The next critical step for Osaka IR is to obtain a license from Japan’s central government. Achieving this milestone will put CEO Bill Hornbuckle and MGM’s Japanese collaborators on a clear path to launching the country’s first-ever Integrated Resort.
Preparing Yumeshima’s Artificial Island for the Project Ahead
The Osaka Integrated Resort (IR) is currently under construction on Yumeshima Island, an artificial island in Osaka Bay, less than a mile from the Osaka harbor. This location was chosen strategically because of its potential to host the large-scale development required for an IR, including casino facilities, hotels, conference venues, and entertainment facilities.
Given the project’s ambitious nature, significant work is needed to prepare Yumeshima Island for the IR. This includes infrastructure development, such as transportation links connecting the island with the rest of Osaka and the Kansai region. Utility services are also necessary to support the complex and the resort’s construction. Environmental assessments and mitigations might also be necessary to ensure the project aligns with sustainability goals.
Overall, while the selection of Yumeshima Island as the site for the Osaka IR represents a significant step forward, extensive planning, construction, and development efforts are still required to bring the vision to fruition.
Final words
After years of legal struggles, negotiations, and high expectations, the first Japanese Integrated Resort is on track to be developed in Osaka. However, certain conditions must be met, such as the initial investment exceeding ¥1.27 trillion ($8.5bn). If these conditions are not met, Osaka IR can withdraw from the project by the end of September 2026. Nonetheless, everyone is optimistic that the project will succeed and help boost Japan’s tourism and economy.
