Hard Rock’s venture into Spain extended again
Casino operator Hard Rock International has been given more time to rescue its Spanish integrated resort project, although the situation appears no closer to resolution than before.
Calvin Ayre reports that late last week, the local government in Spain’s Catalan region granted a three-month extension to the gaming licence it issued last year for Hard Rock International’s proposed Hard Rock Entertainment World project near the coastal city of Tarragona.
This marks the second time that Hard Rock’s Spanish permit has been extended, following a six-month extension that expired last Thursday.
Spanish media reported that this latest extension was granted at Hard Rock’s request, as the company apparently still has faith that it can resolve its land ownership issues and proceed with the 2 billion euro project.
The land in question is currently owned by the development arm of La Caixa bank.
But the property’s previous owners, from whom the land was expropriated by the Catalan government, are now convinced that they didn’t receive a fair price and have launched elgal action to obtain an unquantified top-up payment.
Hard Rock International has so far invested 5.5 million euro to secure its interest in the ambitious Spanish project, but its gaming licence requires the company to increase that investment, something the company appears reluctant to do until it has some assurance that the land issue is resolved.
Hard Rock is also dealing with environmental groups that are trying to stop the project from progressing.
Spain has attempted to mount several major integrated resort projects this decade, none of which have ended up putting a single shovel into the earth.
Las Vegas Sands pursued a mega-resort near Madrid it called EuroVegas, but bailed when the local government declined to relax its strict indoor smoking policies.
Cordish Gaming tried its hand at developing a major Madrid gaming venue, but hinged its interest to securing tax breaks and exemptions from certain land use rules, issues on which the local government was unwilling to bend.
Last year, US firm Cora Alpha proposed a $3.5 billion project in Spain’s autonomous Extremadura region.
Work on the project was supposed to commence before 2019 was done, but there’s been no further news on this front since the company officially filed its development application this summer.
Melco shifts Japanese resort ambitions
Casino operator Melco Resorts & Entertainment is shifting its Japanese integrated resort ambitions away from Osaka to Yokohama, following the lead of some of its rivals.
Calvin Ayre reported in September that Melco Resorts and Entertainment chief executive officer Lawrence Ho announced that his company was adopting a “Yokohama first” strategy for its plan to acquire a Japanese integrated resort licence.
Ho said the company is choosing to “focus on creating an integrated resort in Yokohama city the likes of which the world has never seen.”
Ho called Melco Resorts and Entertainment “a suitable partner” that would assist Yokohama in establishing itself as “an international tourist destination.”
Melco Resorts opened an office in Yokohama earlier this month, and its new Yokohama focus means it is abandoning a plan for an integrated resort project in Osaka.
From Osaka to Yokohama
It was only several months ago that Melco unveiled a concept for a 49-hectare project on Osaka’s Yumeshima Island that included six hotels, a water-themed amusement park and a massive Japanese garden.
On Wednesday, Ho thanked Osaka officials “for their consideration and for constructive dialogues that we have had with them” in the past few years.
But despite these “collaborative discussions”, Ho said Melco’s Japanese ambitions now lay elsewhere.
Ho’s news follows a similar move by rival Sheldon Adelson, whose Las Vegas Sands announced in August that it was ditching its Osaka plans in order to focus on landing an integrated resort licence in either Yokohama or Tokyo.
Philippine casino operator Bloomberry resorts also ditched its Osaka ambitions recently.
Osaka hasn’t totally become Japan’s integrated resorts ugly sister, as MGM Resorts chief executive officer Jim Murren formally adopted an ‘Osaka First’ strategy this spring.
Galaxy Entertainment Group, Genting Singapore and Wynn Resorts are also reportedly still keen on Osaka.
Melco’s news came just as a new survey cast doubt on whether Yokohama’s citizens would welcome an integrated resort in their midst.
The Kanagawa Shumbun and JX Press poll found nearly two-thirds 63.8 per cent of Yokohama residents were opposed to landing an integrated resort, while an even higher majority (72.5 per cent) want the question put to a referendum.
Just 25.7 per cent said they were in favour of welcoming an integrated resort.
Those who favour an integrated resort construction did so mainly because of the revenue it would bring the city, while those opposed fear a downturn in public safety and an increased risk of gambling addiction.