TLDR
- MGM Resorts says construction on MGM Osaka is progressing on schedule, with over 40% of foundation piles installed and the first steel structure in place.
- The $10 billion integrated resort on Osaka’s Yumeshima Island is expected to open in 2030 as Japan’s first legal casino resort.
- MGM and Orix Corporation each hold 40% of the project, with MGM serving as the sole licensing operator.
- The company plans to spend $200 million to $225 million on the Japan project this year, largely funded through a yen-denominated credit facility.
- Texas Capital analyst David Bain values MGM’s Japan resort at $9 per share, and MGM stock rose 1.1% in pre-market trading after the Q1 earnings update.
MGM Resorts International says its massive casino resort project in Osaka, Japan is making steady progress. The company shared the update during its first-quarter earnings call.
The project, known as MGM Osaka, is being built on Yumeshima Island. It carries an estimated price tag of around $10 billion.
When completed, it will be Japan’s first legal casino resort. The planned opening is set for 2030.
MGM and Orix Corporation are the two main partners behind the development. Each company holds a 40% stake in the project.
The resort is designed to include hotels, convention centers, entertainment venues, and large casino floors. MGM will serve as the sole licensing and operating partner once the resort opens.
Construction Hits Key Milestones
During the earnings call, MGM management said more than 40% of the foundation piles have been installed or finished. The first concrete floor has been completed.
The first structural steel has also been put into place. These updates suggest the project is on track with its planned timeline.
MGM expects to spend between $200 million and $225 million on the Japan project this year. The company already invested $140 million during the first quarter.
Much of the funding is coming from a yen-denominated credit facility that MGM closed last October. The company says it is fully prefunded for this year’s construction costs.
That financial setup gives MGM room to keep building without putting extra strain on its balance sheet. The financing plan has been a key part of how the company is managing the project’s large capital needs.
MGM CEO Bill Hornbuckle pointed to the size of the Japanese market as a reason for the company’s commitment. He said Japan has more than 120 million residents and welcomes around 40 million foreign visitors each year.
Analyst Valuation and Stock Reaction
Those numbers are central to MGM’s long-term outlook for the resort. The company views MGM Osaka as one of its most important investments worldwide.
Texas Capital analyst David Bain has placed a valuation of $9 per share on the Japan resort. That estimate adds context to how investors are viewing the project as it moves forward.
MGM stock rose 1.1% in pre-market trading after the company released its first-quarter results. The earnings report came out after market hours on Thursday.
The pre-market bump was partly driven by the construction update on the Japan project. Investors appeared to respond positively to the progress being reported.
The resort remains one of the largest development efforts in MGM’s portfolio. The company has consistently highlighted the project in its earnings updates.
Japan legalized casino resorts in recent years, opening the door for international operators like MGM. The country had long debated whether to allow gambling at this scale.
MGM Osaka is set to be the first project to come through that process. The latest construction milestones show the company moving closer to that 2030 launch date.
As of the most recent update, MGM says the project remains on schedule and fully funded for the current year.
