Osaka Takes Heat on IR Land Expenses

Akihabara News (Tokyo) — Osaka Mayor Ichiro Matsui is taking political heat after it was revealed that local taxpayers will be footing an additional ¥80 billion (US$700 million) bill to decontaminate the land earmarked for the MGM-Orix Integrated Resort (IR), including a casino.

“It is natural that the city—the landowner—should bear the cost of providing safe and secure land to the business operator which will rent it,” Matsui explained.

This extra expense became necessary after arsenic and fluorine exceeding the standard amounts were found ​​in the soil of the planned construction site at Yumeshima. Additionally, the land may be vulnerable to liquefaction in the event of a major earthquake.

Critics point out that warnings about these matters have been issued for years, but previously Matsui had dismissed them and had insisted that local taxpayers would face no extra financial burden.

On Twitter, Matsui defended his policies against such criticism, declaring, “The economic effect of the IR will be ¥1.2 trillion (US$11 billion) per year, the contribution of the casino is ¥55 billion (US$500 million) every year in Osaka city alone, and the land lease fee is ¥2.5 billion (US$22 million) every year. These are the returns to the citizens. Is this still a citizen’s burden?”

He continued, “I consider it an investment when considering the returns of the IR business.”

Matsui went on to criticize how the local media is reporting the issue.

At any rate, Osaka also revealed an updated basic IR plan, including notice that the casino resort is not expected to open its doors to the public until late 2029, about five years later than initially hoped.

The plan calls for the MGM-Orix led consortium to operate the Osaka Yumeshima IR for 35 years. The total initial investment is anticipated to be about ¥1.8 trillion (US$15.8 billion).

It is estimated that the IR will attract about 20 million visitors a year, consisting of 14 million domestic visitors and 6 million visitors from abroad.

Panasonic, Suntory, and JR West are among the roughly twenty other companies expected to participate in the consortium, holding a combined 20% share, while MGM Resorts and the Orix Corporation each hold a 40% share.

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