U.S. tribal operators are increasingly tailoring their offerings towards the Asian market to attract both local ethnic communities and the increasingly adventurous Asian millennial, who may be willing to travel beyond Las Vegas and other traditional destinations.
Some of these U.S. operators are also looking back at Asia, counting on their mass-focused tourism offerings to give them an edge in entering the region.
The most prominent example is the $5 billion development being spearheaded by the Connecticut-based Mohegan Tribal Gaming Authority, with Korean chemical company KCC Corp also providing funds.
When it completes in 2020, Project Inspire will be the largest entertainment and gambling complex in South Korea. The integrated resort, located next to the Seoul-Incheon International Airport, will include a 15,000 seat arena, 1,350 hotel rooms, 200,000 sq ft of convention space, luxury fashion and retail, dining and nightlife options, a Paramount Studios indoor-outdoor amusement park, as well as a foreigners-only casino with 250 table games and up to 1,500 slot machines.
“Our initiative in Korea is an opportunity to showcase the entertainment-driven brand of Mohegan Sun on the international stage,” says Mohegan Sun CEO Bobby Soper. “We strongly believe that Korea, and more specifically Incheon, will be the tourist hub of Northern Asia and as such we feel this is the perfect location to extend our brand.”
“As the closest gaming jurisdiction to Northern China, including the cities of Shanghai and Beijing, there are over 700 million Chinese residents within a two-hour flight of Seoul. In Seoul itself, more than half the country’s population lives in the Capital Area which is only a subway ride from our site, making the opportunity significant,” he said.
South Korea is one of the world’s top ten economies with around 50 million inhabitants, but is widely considered to be an underserved leisure destination. The government is keen to promote the integrated resort experience to attract tourism revenue.
“One of our core focuses has always been entertainment; for example, the Mohegan Sun Arena in Connecticut is consistently ranked as one of the top arenas in the world. And while Korea is a trend-setter in Asia for music and entertainment, it is underserved on entertainment venues and production of live music, which is something we will be able to contribute in a meaningful way through Inspire,” he adds.
Back, in the U.S., the Mohegan Sun and other casinos are seeing an increasing number of Asian visitors to their resorts, opening other potential opportunities for partnerships.
Genting recently agreed to help the Mashpee Wampanoag tribe in Massachusetts build and manage its new $500 million First Light Resort and Casino development, due for completion in 2018.
It will be the first bricks-and-mortar casino for the Mashpee Wampanoag, so joining forces with Genting offers them the experience required to establish and run a large casino operation, as well as Asian expertise. However, the project is currently caught up in a legal dispute over the land targeted for the development.
Michael Zhu, VP of operations planning and analysis at The Innovation Group, says players at the tribal casinos tend to be Asian ethnic groups who are U.S. residents rather than tourists. “They are attracted to the U.S. tribal casinos because they are providing more amenities and offerings with strong ethnic elements such as special food and beverage outlets, hosts who speak the same language, events to celebrate Asian holidays and so on,” he adds.
To accommodate the Asian demographic, Soper says Mohegan Sun has taken a number of steps to ensure the casino floor and entertainment options on offer are in line with player expectations. “With thousands of Asian guests visiting the property each day, we have substantial gaming space with their preferred gaming products, such as Baccarat, Blackjack, Pai Gow, Pai Gow Poker, BJ and Sic Bo, that is appropriately themed and incorporates a feng-shui environment. In addition, we have spectacular authentic culinary and retail offerings to accommodate their tastes as well,” he adds.
Las Vegas remains amongst the top destinations for Asian gamblers playing in U.S. casinos and its position is likely to be bolstered by improved air links with Asia. China’s Hainan Airlines will commence routine non-stop service between Las Vegas and Beijing this December, while Korean Air already offers regular routes between Vegas and Seoul.
“That said, road trips in the US, national parks, and other remote natural assets are becoming increasingly attractive to Asian tourists,” says Zhu. “Particularly amongst younger generations such as millennials, which bodes well for more self-driving Asian tourists hitting Indian reservations and tribal casino properties,” he adds.
Mohegan Sun and Genting are very much the leaders of the pack when it comes to Asian/U.S. tribal relations, and while both developments are still a long way from completion, they may eventually be the catalyst for other such partnerships.
“There won’t be too many more in the short term,” says Zhu. “Everybody is kind of waiting to see how the large projects roll out, such as Mohegan Sun in Seoul, and especially how they attract Asian players without an established client base. But the chances are good that U.S. tribal operators will be able to achieve a decent share of the Asian market.”
If Genting and Mohegan Sun are able to crack the code and develop resorts that appeal to their respective customers, they will leave their rivals playing catch-up for some time to come.
Asia Gaming Brief is a news and intelligence service providing up to date market information for worldwide executives on relevant gaming issues in Asia.
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