Jeju Dream Tower progresses as GGR recovers

Construction at Lotte Tour Development’s Jeju Dream Tower is making significant progress, while the overall South Korean market is trending higher after a political spat between Beijing and Seoul hit revenue at foreigner-only casinos last year.

Union Gaming in a report noted that Lotte Tour Development, which last week said it was buying Paradise’s Jeju Lotte Casino for a total investment of about $39 million, is likely to transfer that license to its new IR under development once it has been completed.

The firm said the acquisition price “is roughly 1/2 to 1/3 the most recent trades, including Landing’s acquisition of the casino at the Jeju Hyatt.” It attributes the political fallout, which led to China-originated gross gambling revenue to be cut by a third, and a lack of rival bids for the cheap price.

The Jeju Dream Tower is scheduled to open next year and will be the island’s second integrated resort.

Union Gaming doesn’t expect the extra competition to have any impact on Macau, but says it may affect the existing foreigner-only casinos in South Korea.

Meanwhile, overall GGR is recovering. Paradise Co. says in the first six months of this year, gaming volumes were up 18 percent.

“As Paradise is the bellwether, we would expect the entire market is broadly in line with Paradise,” it said. Separately, Landing Int’l, which opened Jeju Shinhwa World on 25 February, issued a positive profit alert to the Hong Kong exchange on Friday, noting an approximately 500 percent increase in net profit driven by “the increased revenue contributed from gaming business in Jeju, South Korea.”

Jeju has eight operating casinos, including Landing International’s Jeju Shinhwa IR.