Russia casino operator Summit Ascent Holdings told investors during its first-half 2021 earnings report this week that Japan’s fluttering integrated resort (IR) development process could help its business in Vladivostok.
Summit Ascent, a subsidiary of Suncity Group — Hong Kong billionaire Alvin Chua’s casino empire — is heavily invested in Russia’s Far East. The company maintains a 77.5 percent ownership stake in Tigre de Cristal, an IR in Vladivostok’s Primorye gaming zone.
Former Japanese Prime Minister Shinzo Abe and his successor, PM Yoshihide Suga, want to use large-scale casino resorts as tourism drivers. But interest among prefectures and cities is waning, and that could play into Summit’s hand.
The uncertainty in land-based gaming developments in Japan poses an opportunity for the IEZ (Integrated Entertainment Zone) Primorye to fill this gap, as it is only a short flight away for Japanese tourists,” Summit Ascent opined in its earnings filing.
Tigre de Cristal recently completed numerous upgrades, including a new Suncity Premium Club VIP gaming and hospitality area. Chua largely made his fortune by founding Suncity and operating as a VIP junket service in Macau.
Russia’s Gaming Mecca
Japan’s commercial gambling law — first passed in 2018 — calls for the issuance of three IR licenses. But with Yokohama likely out following its mayoral election last weekend, and the winner pledging to annul the city’s casino effort, Japan has only three prefectures bidding for the gaming rights.
Osaka, Wakayama, and Nagasaki are moving forward with IR pitches. But Japan could decide not to award all three permits, which would be a major win for Russia and its goal of building its own version of the Las Vegas Strip in Vladivostok.
Tigre de Cristal was the first IR to open in Vladivostok in 2016. It was to be the first of numerous large-scale casino resorts, similar to those on the Las Vegas Strip, to open in the Primorye gaming zone.
But five years later, and Tigre has been joined by only one other resort. Casino Shambhala opened last fall. A third resort — Naga Vladivostok — remains under construction.
Russia’s gaming zone is some 20 miles by air north of the Vladivostok port. The casinos are roughly a 40-minute drive north of the city, and 20 minutes from the city’s international airport.
A flight from Tokyo to Vladivostok takes a little less than two hours.
Summit Optimistic on Russia
Summit Ascent is bullish on Russia’s still largely undeveloped gaming region. If Japan limits its IR projects, that could spur further development in Vladivostok, the Tigre de Cristal owner believes. Summit is also confident regarding locals spurring gaming and hospitality revenue.
As vaccination rates in the country continue to be improved, it is less likely that mandatory closure of the integrated resorts will be required again. Therefore, we believe that the worst-case scenario affected by the pandemic has already passed,” the Summit statement detailed.
Summit Ascent reported that gross gaming revenue in the first six months of 2021 grew nine percent from 2020 to $17.9 million. Mass market — aka the general public — was cited for the uptick. Hotel room sales surged 82 percent to $860,000.
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