The MGM Japan president and CEO, Ed Bowers, acknowledges the challenges associated with introducing casino gambling to Japan, which is the world's fourth largest economy, and doing so with the world's most expensive integrated resort. "There’s a lot of trepidation about being the first to have this very large casino in Japan, and the issues it could bring, and we understand all of this,” Bowers stated during an interview at MGM’s Osaka office. Despite the uncertainties, there is local enthusiasm surrounding Osaka, which after being seen as Japan’s second city for years, is poised to lead in this new venture.
MGM Osaka has been over a decade in the making, with plans for a late 2030 opening. This joint endeavor with Orix Group is expected to result in a facility costing an estimated ¥1.5 trillion (approximately US$9.5 billion), situated on Yumeshima Island, the site of the 2025 World Expo, which has received positive public perception in Osaka.
Investment into infrastructure is evident with a subway station partially funded by MGM Osaka, which opened in January of last year for Expo visitors, conveniently located at the entrance to the integrated resort (IR). Additionally, Kintetsu Group, which is one of the 22 local investors holding a 12% stake in MGM Osaka, plans to establish train service linking Yumeshima to Nara, a popular tourist spot located 45 kilometers to the east, alongside a ferry and cruise ship terminal.
MGM Osaka stands as Japan’s most significant construction project currently underway, covering a 49-hectare (122-acre) area. The site is alive with construction activity, characterized by workers and heavy machinery at work. As Bowers indicated, efforts are ongoing to mitigate risks such as liquefaction and stabilize the ground for the extensive building process.
The total floor space allocated for the integrated resort is set to be 780,000 square meters (approximately 8.4 million square feet), according to the latest area development plan (ADP) released by Osaka City, Osaka Prefecture, and MGM Osaka on July 31, which is published solely in Japanese.
Featuring notable steel frameworks, the largest building within MGM Osaka is expected to rise 27 stories, housing two hotels and the casino, which will consist of 2,500 guest rooms, with more than 20% of those being suites ranging from 105 to 150 square meters.
The integrated resort will also offer one of Japan's largest MICE (meetings, incentives, conventions, exhibitions) capabilities, providing 400,000 square feet (36,171 square meters) of conference area and 330,000 square feet of exhibition space, along with a 3,500-seat theater. Adhering to Integrated Resort regulations, accommodation and MICE space allocations are meticulously detailed within the ADP.
Bowers expressed confidence, saying, "There’s a certain amount of overseas MICE events they want us to do. We know how to run MICE." He pointed out that the ADP designates MGM as the largest MICE operator in Las Vegas, which produces an annual accommodation demand of 2.5 million rooms and hosts over 9,000 events each year.
While requirements for tourist facilities are less rigid, Bowers detailed three essential functions mandated: a tourism attraction center that will provide concierge services, sell event tickets, and facilitate access to various destinations. He emphasized the IR’s role as a "tourism multiplier," aimed at both attracting visitors to Japan and distributing them across the country.
Japan welcomed 42.68 million international visitors last year, and is set to exceed 41 million this year, despite challenges such as political tensions affecting visitor numbers from mainland China, which experienced a 56.7% decline through August, according to the Japan National Tourism Organisation. Japan’s ambition remains set on achieving 60 million visitors by 2030, although adjustments are being made to ensure sustainable tourism development, especially in prominent destinations like Kyoto, located 63 kilometers northeast of Yumeshima.
Bowers highlighted the importance of aligning with Japan’s tourism policies: "We’re honour-bound to think about how we can work with Japan to make sure that we are focused on their tourism policies because tourism policies are at the heart of what it is that we have to do for Japan. The quid pro quo is we get a casino, which is where we’ll make all our money."
Gaming facilities within the resort will occupy 3% of the total area, translating to 23,400 square meters dedicated to gaming. Japanese nationals will incur a ¥6,000 entry fee valid for 24 hours, with restrictions on visits limited to three times a week and ten in a 28-day period.
The latest ADP forecast has projected annual revenues from the integrated resort to reach ¥520 billion, with gaming earnings contributing ¥420 billion (around US$2.65 billion) of that total, which is comparable to the previous year's gross gaming revenue at Sands China's Venetian Macao complex. Bowers anticipates that approximately 50% of the revenue will derive from Japanese visitors.
As noted by Chris Wieners, managing partner at Hogo, MGM Osaka's significance extends beyond financial aspects and could set a precedent for future IR operations in Japan. Likewise, Pham Thanh Trung, a planner for the Osaka International Business Promotion Council, acknowledged the mixed sentiments of the local citizens, recognizing both the potential merits and prevailing uncertainties tied to this inaugural casino venture.
"Japan is completely virgin and vulnerable to casinos. People do not know how to live with a casino in the city," remarked Pham, who has ties to the area.
While the country does not currently boast casinos, Wieners pointed out that a robust gaming culture already exists through various forms of legalized gaming, such as pachinko and amusement venues. This sector reported ¥8.874 trillion in legal betting last year across gaming activities, with horse racing alone accounting for US$22 billion, nearly 20% of the global total. Entertainment casinos also exist, where chips can be purchased without the possibility of exchanging them for actual money.
Dominic Carter, CEO of the Carter Group, referred to their findings in 2019 which indicated that the perception of casinos differs markedly from pachinko. While pachinko is often viewed as a habitual pastime, casinos are envisioned as glamorous and reserved for special occasions. He believes this distinction will influence Japanese customers' behavior regarding casino visits.
The serious issue of responsible gaming has been acknowledged, with local consumers tending to perceive individual responsibility as paramount, followed by expectations placed on regulators. Carter anticipates this perspective will play a role in how the public perceives MGM's responsible gaming practices.
Bowers expressed optimism about Osaka's commitment to leading the way in responsible gambling efforts. "To its huge credit, Osaka wants to lead Japan and possibly lead the world in its efforts on problem gambling,” he stated. MGM Osaka is planned to implement a comprehensive responsible gaming program modeled after Game Sense, while collaborating with the local government's Osaka Addiction Centre to align their approach with government policies.
He noted, "I think, frankly, Osaka is going to end up with a best-practice approach and framework for how to gamble responsibly, and that’s going to be a first. Osaka City is taking their obligations very seriously."
The development of Yumeshima has drawn comparisons to other successful integrated resorts in East Asia. While Las Vegas Sands’ Venetian Macao vastly transformed Cotai Island, and Resorts World Sentosa successfully developed Singapore, Japan is similarly pursuing a high-stakes integrated resort model. An official plan for Yumeshima is already being executed, contrasting with the earlier unrestricted development in Cotai.
In September, Osaka authorities set a US$595 million minimum bid for an additional phase of the 42-hectare site next to MGM Osaka, which includes part of the land used for last year’s Expo and preliminary proposals for theme parks and hotels. Government-directed development aimed at creating a vibrant recreation and entertainment hub echoes strategies employed in Sentosa, albeit with an official plan that outlines the development and connectivity of land use.
As Osaka makes strides in their development of Yumeshima, local authorities are ensuring that the process is thoughtful and deliberate, drawing lessons from successful integrated resort models to establish a beneficial framework for the future of gaming in Japan.
