After more than 25 years of proposals, delays, and political hurdles, Japan has finally broken ground on what is set to become Asia’s highest-grossing casino. The ceremonial groundbreaking event took place on Thursday at an artificial island in Osaka Bay, with executives from MGM Resorts International and Orix Corp., alongside local politicians, marking the milestone by breaking barrels of sake in a traditional Japanese ceremony, Bloomberg reports.
The ¥1.27 trillion ($9 billion) casino resort, a joint venture between MGM and Orix, is scheduled to open in 2030. Once completed, it is expected to become the largest casino in Asia, with an estimated annual gross gaming revenue of $5.9 billion. This would make Japan the third-largest gaming market globally, trailing only the United States and Macau, according to Bloomberg Intelligence. The Galaxy Macau, the current largest casino in Asia, earned approximately $4.5 billion last year.
The sprawling resort will not only feature a state-of-the-art casino but will also include three hotels, expansive convention and meeting facilities, a concert theater, and a variety of shopping and dining venues. The project is located on Yumeshima, an island in Osaka Bay, which is also set to host the 2025 World Expo.
Ed Bowers, CEO of MGM Resorts Japan, expressed his excitement at the event, saying, “I’ve been working on this for more than 15 years, and no one is more happy than I am to see this happen. It’s not been an easy road, and we will continue to see challenges until and after this opens.”
Despite the optimism, analysts warn that the next few years could present significant challenges. Japan’s construction industry is facing a severe labor shortage, and there is growing competition from other Asian markets developing similar casino projects. Additionally, the rise in online gambling could impact the viability of physical casinos, particularly if Japan legalizes online betting.
Jay Defibaugh, an analyst at CLSA in Tokyo, noted that the successful launch of the casino is far from guaranteed. “There’s very little doubt that it will go ahead. There’s a license,” he said. “But whether it meets the target opening of fall 2030 — that’s not so certain because nobody’s built something like this in Japan before.”
The project is likely to have a monopoly on Japan’s nascent casino industry. While the Japanese government initially authorized three casino licenses, only the MGM-Orix project in Osaka has been approved. A proposal from Nagasaki Prefecture was rejected in 2023. With no immediate competitors on the horizon, the Osaka casino will have significant control over the local market when it opens.
However, the path to this milestone has not been without controversy. Despite the project’s anticipated economic benefits, including the creation of jobs and a potential tourism boost, there is vocal opposition from some local residents. A group called the Association of Residents Opposed to the Casino has sued the Osaka government, citing concerns over social costs such as gambling addiction and the strain on public services like policing and the judiciary. To address these concerns, the casino will limit Japanese visitors to three entries per week and charge an entry fee.
Osaka Governor Hirofumi Yoshimura, one of the key proponents of the casino, remains confident that the project will benefit the local economy. “I’m confident that this will serve as a catalyst for further growth,” he said during the groundbreaking ceremony.
The casino project is a long-awaited development in a country that first considered gambling resorts more than two decades ago. The Japanese government officially legalized casino resorts in 2018, after years of debate and public opposition, which was fueled by concerns over gambling addiction and the potential for money laundering. These issues, combined with corruption scandals involving lawmaker bribery, led many potential investors, including major companies like Caesars Entertainment and Las Vegas Sands, to withdraw from the competition.
Despite these setbacks, the MGM-Orix venture has remained steadfast in its commitment, buoyed by investments from local businesses and a ¥530 billion debt financing package led by Mitsubishi UFJ Financial Group and Sumitomo Mitsui Banking Corp.
As Bloomberg highlights, while challenges remain, the groundbreaking marks a significant step toward Japan’s ambitious goal of creating one of the world’s largest and most lucrative casino resorts.
