South Korea’s biggest casino operator, Paradise Co Ltd, and top-three Japanese slot and pachinko machine creator Sega Sammy Holdings Inc plan to open the country’s first integrated casino resort on Thursday in South Korea’s second most populated city, Incheon.
Many analysts are predicting soft numbers for the opening, but not because South Korean citizens will not be allowed to play there – that’s a given. The casino will not likely see much foot fall from mainland Chinese VIP or mass market gamblers, who normally account for about half of the revenues seen in all casinos except the remote Kangwon Land casino where anyone can play.
Paradise City will open on the site of the former Paradise Casino Incheon, which has been integrated in most part into the new casino resort. Incheon, with a population of some 3 million is located about 25 miles (40 km) from the Seoul Capital Area, which holds approximately 10 million people. Incheon is located a scant 33 miles from Kaesong, North Korea and well within striking distance of the antiquated but lethal artillery of the north.
As Beijing closed its fist tighter on graft and corruption over the last few years and mainland Chinese VIPs began abandoning Macau, South Korea became one of the beneficiaries of the policies, and revenues skyrocketed at many of the country’s casinos.
As US-Sino relations associated with North Korea have gotten more complicated, so have the equations for casino success. China has placed a ban on mainland travel agents selling tours to S. Korea in protest of a missile defense system that is being deployed by the US.
Reuters reports that March visits to South Korea fell 39 percent in March over the same month in 2016 after the travel ban was put in place.
China is not the only feeder market for a pioneering integrated resort experience in Northeast Asia and the Sega name should help the company in promoting the new experience to Japanese and other Southeast Asian customers – which in the long run can only strengthen revenues once the Chinese return.
Another element that bodes well for the numbers is the fact that many if not most of the ultra-wealthy Chinese visitors who gamble entire fortunes every minute at the baccarat tables, hold multiple citizenships and can avoid most diplomatic situations.
As South Korea and other magnet markets that have benefitted over the last two years from Beijing’s crackdown experience a relaxing of profits, Macau GGR is on the rise. Overall gaming revenue rose 18 percent in March there with VIP growth outstripping mass market growth by a ratio of two to one.
South Koreans have an insatiable appetite for entertainment and Paradise City has marketed itself as much more than a casino. So even though local denizens cannot enter the gaming space, they can experience what Paradise Sega Sammy calls the Art-Tainment aspects of the property.
The Grand Ballroom can accommodate up to 1,820 people, fine dining is available in a variety of cuisines and atmospheres, deluxe private pool villas, as well as indoor and outdoor pools open to guests, will attract locals, as will the Paradise City Club Lounge. The spa and sauna, sports club and bowling alley will see good traffic. And especially for the Spring season, the Cherry Blossom Road encircling the Dulle-gil trail there beckons young and old alike to stroll down a blossom covered trail.
Of course, Koreans holding foreign passports, regardless of where they actually reside will be welcomed into the casino and VIP sections as well.