Japan’s Integrated Resort Market Reopens?

The sun’ll come out
Tomorrow
Bet your bottom dollar
That tomorrow there’ll be sun

The Land of the Rising Sun looks to be back in play for new IR licensing opportunities. While it is hard to get overly optimistic about the prospects after initial efforts resulted in only one surviving bid, there are several factors now that could move potential bidders back into the equation.

Next Best Opportunity?

First, opportunities for new, large-scale development elsewhere in Asia aren’t imminent. Thailand looked like as close to a sure thing until, as they are all too accustomed to doing, the country had a sudden leadership transition that killed the prospects (at least for now). Macau’s casino concessionaires all got renewals of their licenses at the end of 2022, so there are no new opportunities for entry there. For those looking for a new opportunity in the region to develop something of large scale, Japan looks to be the most obvious (but certainly not only), imminent option, especially for those with the need for concern with strong regulations (i.e., U.S. operators).

Barriers Removed

Second, for those looking around Japan in the late-2010’s when licensing opportunities arose, there may have been some trepidation with respect to uncertainty regarding regulations, particularly with respect to domestic gaming participation, or possibly the income taxation of foreign players, which would limit the attractiveness of visitation by high net worth foreign gamers. While there are a variety of restrictions being imposed on domestic players, from limits on the frequency of casino visitation to a nominal entry fee and presentation of an ID card, none are draconian. Additionally, in 2021 the Japanese government pivoted from its initial stance, and decided that gaming winnings by foreigners would be income tax-exempt. For operators that found either or both of these restrictions to be barriers for them to enter the market, it is reasonable to expect that they will take another look.

Political Support

And finally, newly-elected Prime Minister Senae Takaichi has ordered her Minister of Land, Infrastructure, Transport and Tourism to promote IR development, with surveys going out to all prefectural and city leaders already to gauge interest, and the possibility of a revised round of bidding as early as 2026, and award by the end of 2027. There are still two IR licenses that are available to be granted nationwide. Hokkaido’s Governor Suzuki has seemingly said yes to considering a renewed effort to bring an IR to his prefecture. Suzuki plans to address his assembly with a new IR plan in November 2025, addressing old concerns of problem potential costs and benefits of development, from economic gains to problem gambling and environmental protection (the Hokkaido site considered in 2019 was home to nests of several rare birds). Similarly, there are likely to be renewed efforts in Nagasaki or Wakayama, where previous plans came close to fruition (at least to the level of a bid submission). There is certainly the possibility that other, major cities could jump back into the fray, but given the level of local opposition in some of these cities (officials and residents), they may be considering the prudence of waiting for the next round of licensure, in the 2030’s, to gauge the merits of MGM’s presence in Osaka.

Author’s Note: Convergence Strategy Group Co-Founder, Scott Fisher has been actively involved in the Asian gaming space for nearly three decades, evaluating opportunities, right-sizing projects, and providing professional support which has resulted in some of the largest and most successful gaming developments in the world.

Other blog posts from Dr. Fisher include: Chinese Tourist Return and the Future of Asian Casinos, Progress Toward Integrated Resorts in Japan, Chinese Gamers – A Commodity Hit by the Trade War?, No New Casinos in The Philippines?, Integrated Resorts in Japan: When, Where, and How Much?, Coming Full Circle: Japan Gaming Congress 2018