Osaka has long been known as a center of commerce and finance. Historically it acted as the central hub of feudal Japan’s economy, and while in modern times Tokyo has overtaken it by almost every metric, Osaka remains an important financial center. Its reputation as a city with money on its mind also remains intact, and may indeed grow stronger after the construction of a new integrated casino complex.
Osaka’s famous Dotonbori neighborhood. Photo by Agathe Marty on Unsplash
The newly proposed facility would be one of three of the first legal casinos to open in Japan, the others likely to be located in Yokohama and Tokyo. These new casino facilities would be the result of a 2018 law passed to legalize casino resorts in Japan, a hard-won victory for the global gaming industry in a country with a complicated relationship with gambling.
Of the few candidate cities, Osaka is furthest along in its process of selecting a partner company to construct the proposed casino facility. While it was once a tight race between 8 companies, including gaming industry giants Caesars Entertainment and Las Vegas Sands, the recent withdrawal of top competitors Genting Singapore and Galaxy Entertainment has left MGM Resorts as the sole frontrunner in the race to secure the coveted Osaka license. The city hopes to make its final decision by June of this year, and it looks all but certain that the proposal from MGM and its local partner group Orix will be accepted.
The construction of a casino facility in Osaka will have a significant impact on the local economy, and particularly the real estate market. Land prices in the surrounding area will no doubt skyrocket should the project be approved, and rental yields are projected to increase dramatically as well, with some estimates claiming an increase from 3-4% to almost 10%.
A mock-up of MGM’s proposed integrated casino resort. Image Source: MGM Resorts
The project itself is estimated to be one of the most expensive casinos in the world, with some experts estimating that 10 billion USD will be the bare minimum starting cost, almost double the 5.88 billion USD price tag of Marina Bay Sands, the previous record holder for the most expensive casino in the world.
The new casino comes at a time of rapid growth for Osaka, and indeed Japan at large--the 2020 Olympics, while being held in Tokyo, will no doubt bring a huge influx of tourists to Osaka, which will in turn drive demand for accommodations, fueling the development of lodging facilities and purchases of short-stay properties. Just 5 years later, Osaka will get its turn in the limelight at the World Expo 2025, which is planned to share a venue with the new casino--a newly re-developed artificial island off the coast of the city called Yumeshima, or “dream island”.
With so much development planned for the near future, dramatic growth in Osaka’s real estate market seems almost guaranteed, making property investment seem like a safe bet. Yet as with any bet, only time will tell if the casino project ends up paying off.
Editorial Department
Bringing you the latest real estate & lifestyle news in Japan
