Casino operators such as Hard Rock International and the Las Vegas Sands are considering entering the Japanese gambling market due to its potential, but one gaming analyst says that the lawmakers of Japan may only allow a limited number of gaming facilities in the country.
Alex Bumazhny is a senior gaming analyst for Fitch Ratings who recently spoke with “Street Signs” of CNBC and stated that the potential casino revenue of Japan has been estimated to hit $5 to $10 billion a year, which is easily comparable to Las Vegas as well as Singapore. However, this is much lower than what Macau is expected to earn in 2017, at $25 billion.
There has been much optimism surrounding the decision of Japanese lawmakers to legalize casinos late last year. The country has a huge demand domestically for gaming as the residents enjoy pachinko, a game similar to slots, in massive numbers.
According to Bumazhny, the analyst believes that Japan is not going to catch up with Macau due to the fact that lawmakers, as they are making the bills, will place a limit on the amount of gaming that will be allowed to take place. Bumazhny feels that two to three larger integrated resorts will be allowed and maybe a few smaller casinos of the regional type will be up for grabs.
The analyst further stated that lawmakers may even limit the locals from taking part in gaming or create a fee for locals like Singapore. The locals of Singapore have to pay a fee in order to gain entry into the casinos.
It was in 2010 that casinos first opened in Singapore and concerns of the social impact from gambling made regulators create an entry fee for casinos of $70.90. Citizens of the country as well as permanent residents have to pay this fee in order to go inside the gaming venue. Even with such restrictions in place, the integrated resorts in Singapore have done well.
For Japan, lawmakers have until December 2017 to create rules on how the gambling industry will be regulated. Locations as well as operators for the first integrated resorts are expected to be chosen, offering casino gaming, hotel space and retail areas.