Osaka, Japan, has decreased the estimated initial cost for land liquefaction countermeasures related to the integrated resort (IR) project by 37.8%. The cost reduction is attributed to a decrease in the land area to be treated and a change in the land-improvement method. The revised cost is JPY 25.5 billion (approximately US$172.5 million), down from the previous estimate of JPY 41.0 billion.
Cost Reduction Factors:
The reduction in the estimated cost is due to a decrease in the land area to be treated, reduced to 21 hectares from the previous 38 hectares. Additionally, a change in land-improvement methodology from a sand compaction pile system to a cement solidification one contributed to the cost reduction.
Total Remediation Cost:
The total cost for all remediation work on the casino resort site at Yumeshima, including ground improvement, obstacle removal, and soil contamination management, was previously forecasted at JPY 78.8 billion.
IR Project and Partners:
Osaka’s IR project is a collaboration between the local authorities and private-sector partners, including MGM Resorts International and Japan’s Orix Corp. The MGM Osaka project, valued at US$10 billion, is expected to open in 2030.
Reduction in Gross Floor Area:
Bill Hornbuckle, CEO and President of MGM Resorts, mentioned a reduction in the gross floor area of MGM Osaka by up to 25%, although the specific reason was not provided. It is unclear if this reduction is related to the ultimate scale of the IR or potential future expansion.
Project Timeline:
Piling work for the MGM Osaka project is expected to commence in spring 2024, according to Mr. Hornbuckle’s remarks at an investment event.
Osaka’s decision to reduce the estimated initial cost for land liquefaction countermeasures is a positive development for the IR project, demonstrating improved efficiency and cost-effectiveness in the site preparation process. This could potentially expedite the project’s timeline and contribute to overall cost savings.