Gaming and hospitality industry giant Las Vegas Sands is pulling out of Japan’s integrated resort bid.
Japan IR Bid No Longer a Plan for Las Vegas Sands
Las Vegas Sands has withdrawn its bid for a Yokohama prefecture Integrated Resort (IR) in Japan, the company announced in a press release on Tuesday, May 12. An investment of some $10 – $12 billion will no longer be pursued in Japan, with the company shifting its sights on its extensive investment plans in Macao and Singapore instead.
Sheldon Adelson, Las Vegas Sands Chairman and CEO noted that the framework surrounding the project made it impossible to be completed. He said: “While my positive feelings for Japan are undiminished, and I believe the country would benefit from the business and leisure tourism generated by an integrated resort, the framework around the development of an IR has made our goals there unreachable.”
Adelson continued: “We are grateful for all of the friendships we have formed and the strong relationships we have in Japan, but it is time for our company to focus our energy on other opportunities.” Furthermore Adelson noted that he remains “bullish“ about the future growth of Last Vegas Sands. He also didn’t miss to note that the company’s projects in Macao and Singapore are the current market leaders and that Las Vegas Sands is currently executing an investment program for both.
Short History of LVS’s Japan IR Bid
The saga for Japan bid started back in 2018. Back then, Las Vegas Sands was planning to become the industry leader in Japan. Early in 2019, Las Vegas Sands Chief Operating Officer, Rob Goldstein noted that Osaka was the sole city in Japan that can accept such an expansive project. This however was changed in April 2019 when the company announced that the project plans had shifted from Osaka to Yokohama and Tokyo.
Rumor has it that one of the reasons for dropping out of the race might as well do with Japan’s current license validity. Las Vegas Sands’ resorts in Macau and Singapore received a 20-year and a 30-year license, while the expectation for Japan was a 10-year license. This made the planned $10-$12 billion investment questionable, considering also the 5 year plan to build the resort in the first place.
This is not the first market giant that has left the market recently. It was only last year when Caesars Entertainment also pulled out of the Japanese market following Eldorado Resorts merger.
LVS has expressed doubt back in 2019, with Goldstein suggesting at the end of last year that Las Vegas Sands might struggle to create the necessary shareholder value.