In spite of the COVID-19 outbreak, operators continue to be keen on Japan’s integrated resorts – iGB
Even with the COVID-19 outbreak, one in five companies considering bidding for Japan’s three integrated resort (IR) licenses stated their interest in the project has “diminished slightly,” while two-thirds remain steadfastly dedicated to the competition.
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Operator enthusiasm for Japan’s integrated resorts persists despite COVID-19
In spite of the COVID-19 outbreak, one in five companies considering bidding for Japan’s three integrated resort (IR) licenses stated their interest in the project has “diminished slightly,” while two-thirds remain steadfastly dedicated to the competition.
The Japan Integrated Resort Association (JIRA), which was established in June, conducted a new survey questioning 132 parties interested in participating in the IR project about the impact of the COVID-19 outbreak on their future plans.
Of those surveyed, 89.4% said their work connected to the IR project was impacted by the virus.
However, the majority of respondents (66.7%) said their interest in the project had not changed despite the disruption. Meanwhile, 21.3% of respondents said their interest had decreased compared to before, while 12.0% said their interest had increased.
Among the issues the virus could bring, the difficulty of international travel was the most frequently mentioned, with 61.4% of respondents saying it could be a problem.
Another 59.
A mere 0% of individuals voiced worry about the complexity of forecasting demand, whereas 40.9% harbored concerns about the financial burden of infectious disease control measures. Meanwhile, 39.4% highlighted the difficulty of establishing such destinations in the midst of remote work.
There was a wide spectrum of viewpoints regarding the duration of these obstacles, but 27.5% asserted that the impact of these challenges would be enduring. Conversely, 20.6% claimed the impact would persist for over two years; 26.7% predicted the impact would last for two years; and 16.8% anticipated the impact would last for approximately a year.
When queried about the primary determinants of success or failure for integrated resorts, 60.3% indicated that the trajectory of the global economy would be pivotal. Additionally, 56.5% asserted that existing legal and regulatory frameworks would be decisive, while 53.4% cited domestic demand.
Among legal and regulatory priorities, a majority of respondents identified taxes as the most critical issue, with 60.5% listing it as a key priority. In contrast, 58.1% mentioned licensing systems and 28.7% cited responsible gambling.
In March 2019, the nation enacted regulations governing the development of integrated resorts. However, the proposal has been met with controversy, and an opposition legislator introduced a bill in January 2020 to repeal it.
The proposal has also been hampered by the COVID-19 pandemic. The fundamental policy (to establish a regulatory framework for the selection process) was slated for passage in the first half of 2020, but it has yet to be approved.
This implies that the final date for prospective host cities to select private sector partners for combined resort development will likely be postponed, with Osaka and Wakayama already delaying the bidding process.
Prior to this, some prospective bidders had concluded that the rules were too restrictive to make the project feasible. Las Vegas Sands consequently withdrew its bid in May of this year. Conversely, MGM Resorts remains dedicated to bidding for the permit.
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