Coveted land near an upcoming MGM casino resort is available for purchase, but only developers with substantial financial resources should consider applying.
MGM Resorts International and Orix Corporation are working together on the construction of the more than $8 billion MGM Osaka on Yumeshima Island. Expected to open in late 2030, the integrated resort (IR) casino will offer 2,500 hotel rooms, dining and shopping areas, a 3,500-seat entertainment venue, wellness amenities, over 700,000 square feet of convention and exhibition space, and a casino featuring more than 6,000 slot machines and 400 live dealer table games.
Yumeshima, which is an artificial island, has been designated by the Osaka government to become a top destination for international tourism and business events in Japan.
The development of Yumeshima includes the MGM Osaka project as Phase 1. Phase 2 involves the development of over 100 acres of land adjacent to the casino into the “IR Collaboration Zone,” where the Osaka City Council hopes a developer will create “large-scale entertainment and recreational facilities,” such as a theme park or sports stadium.
Land Available for $595M
The Osaka City Council is offering 424,074 square meters (104.8 acres) of land for Phase 2 development on Yumeshima Island, where Expo 2025 Osaka-Kansai was held. The government is looking to get top dollar for the development rights.
Osaka has priced the Phase 2 development property at ¥92.1 billion (US$595 million), which amounts to more than $5.6 million per acre.
While the 121-acre MGM site is being leased to the casino developers, Osaka intends to sell the Phase 2 site. MGM Osaka has a 35-year lease agreement with the city to operate the resort on the government-owned land, with an annual rent of approximately $16.1 million.
To reduce the initial land investment, the developers of MGM Osaka requested to lease the land for the resort rather than purchasing it. However, if the full 35-year term is completed, the resort would pay over $563 million for the land lease.
In 2019, Mayor Ichiro Matsui explained that by retaining ownership of the land, the city would be protected against potential business challenges in the future.
If the operator encounters challenges in other regions or operations, Osaka would not interfere if the operator owned the land. However, if the land is leased, the city can seek out a different operator,” Matsui said in 2019.
“We believe leasing is the most favorable option,” the mayor concluded.
Casinos and Theme Parks
In Asia, it is common to combine casino resorts with family-friendly theme parks.
Destinations like Genting Highlands in Malaysia have the SkyWorlds Theme Park, while Resorts World Sentosa in Singapore features a Universal Studios amusement park.
In Macau, properties like Studio City, Galaxy, and The Venetian include theme parks and rides, and resorts in South Korea such as Paradise City and Inspire offer indoor water parks. The City of Dreams Manila in the Philippines has an indoor theme park developed in collaboration with DreamWorks movie studio.