Galaxy Entertainment appears to be joining the ranks of other Macau gambling giants by announcing its decision to enter the bidding for a Japanese casino license. Gambling in Japan was legalized in late December of 2016, but it didn’t take long for the competition to grow fierce. Now the race is on to see who can secure a license in what is expected to be a lucrative gaming market. Japan has already seen a number of household casino names express their interest in establishing casino resorts in japan, such as MGM Resorts, Wynn Resorts, Melco Resorts & Entertainment, and Las Vegas Sands.
Like many other gaming enthusiasts, Galaxy Entertainment believes that the new market in Japan could hold great value for the gaming industry. “We see loads of potential in the Japanese market and aim to win a casino license there in cooperation with Societe des Bains de Mer,” said Francis Lui, Galaxy’s vice chairman at the group’s annual general meeting on Thursday.
The question now becomes what will the future of gaming in Japan look like and what companies will emerge as the leaders of Japan’s gambling scene. Lawmakers are tasked with the responsibility of setting the framework that will be suitable for the industry to operate under. An implementation bill is set to be finished by the end of 2017 and is expected to contain information about the process of selecting the preferred location of two or three integrated resorts in different metropolitan areas. Galaxy Entertainment is one of six casino operators interested in establishing themselves in Japan; inevitably someone will lose out.
The interest in Japan’s gaming market could not be greater, partially due to the sheer volume of Chinese tourists frequently visiting Japan. All parties involved in the bidding process won’t shy away from big spending when it comes to their involvement, thanks to the fortunes their successes from Macau have brought in. Galaxy Entertainment recently reported impressive Q1 revenues that exceeded analysts’ projections. Most of this success stems from the popular casinos in Macau, which has seen success since being the only Chinese region to legalize gambling. Galaxy Entertainment expects this trend will continue in Japan.
Early estimates suggest that starting a casino resort project in Japan could cost as much as $10 billion to complete. That being said, Brokerage CLSA puts annual gaming revenue estimates at $10 billion also. There’s no question that the industry is set to boom in Japan, but some even suggest that it may end up being second to only Macau. Casino licenses are expected to be given later this year when the legislation begins to solidify, and Galaxy Entertainment hopes to be the recipient of one of these licenses. If they are able to secure this license a casino resort project could be open as early as 2021.