Genting Singapore to build $2.2b casino on South Korea’s Jeju Island
Genting Singapore, operators of the Resorts World Sentosa integrated resort, have announced plans to build a $2.2b gaming facility in South Korea. On Friday, Genting announced it had teamed with Chinese property firm Landing International Development Ltd. on the project, which will be named Resorts World Jeju, in keeping with its location on Jeju island off the peninsula’s southern coast. Jeju is already a popular destination for Chinese tourists, making it an ideal spot to set up baccarat tables.
Yang Zhihui, chairman of the Hong Kong-listed Landing Interational, told reporters that the facility plans to offer 200 VIP gaming tables and 600 mass market tables, as well as a rollercoaster-equipped theme park, retail shopping and a 2,800-room hotel. The project would target gamblers from the eastern and northern regions of China. Yang said the island was one hour away by plane, “which makes so much more sense” for gamblers in Beijing, Shanghai or Qingdao to choose Jeju over Macau.
Kang Tae-seog, director of Jeju’s Marine Development Division, said 10m people visited the island in 2013, of which 2.2m were foreigners. Jeju is a leading port of call for cruise ships, with some 500k passengers expected to dock in Jeju this year and Yonhap News quoted Cruising Asia committee chairman Kim Eui-keun saying that figure will exceed 2m by 2020. South Korea’s government has proposed a bill that would allow casino gambling by non-Koreans aboard cruise ships run by Korean companies. Korea’s first flag-carrying cruise ship launched in 2012 but shut down a year later because it couldn’t turn a profit without the ability to offer casino gambling aboard.
South Korea has 17 small-scale casinos in operation, the most profitable being Kangwon Land, the one gaming joint in which local residents are allowed entry and which earns more than the other 16 foreigner-only casinos combined. Resorts World Jeju is only the second large-scale resort casino project to be announced since South Korea declared itself open to international casino developers. The joint venture of Paradise Co. and Sega Sammy Holdings is currently being built near Incheon International Airport west of Seoul.
South Korea recently decided it might have been too demanding in terms of the financial requirements for companies to be allowed to participate in the country’s casino market. The country took that one step further this week after the Ministry of Culture, Sports and Tourism announced that investors holding a credit rating beneath BBB would not have their applications automatically disqualified, potentially opening the door to debt-laden casino firms like Caesars Entertainment, whose applications had previously been turned down over concerns that they might not survive long enough to see a large project through to completion.
This week also saw South Korea announce a $1.8b tourism project on Yeongjongdo Island, a free economic zone near Incheon International Airport that has been the proposed site of more than a few casino hopefuls (including the Paradise Sega Sammy project). While the developers insist that no casino is planned for the collection of water parks, golf courses, shopping centers and hotels, the ‘Dream Island’ complex would be 61.5% controlled by Han Chang-woo, chairman of Kyoto-based pachinko operator Maruhan Corporation. The Dream Island complex is expected to open in 2020.