The Osaka Prefectural Government signed an agreement with a developer on Thursday to build a casino resort, with plans to have it operating by fall 2030.
Officials hope the so-called integrated resort will help spur the regional economy after the end of the 2025 World Expo in the city of Osaka.
The agreement was signed with Osaka IR, which is led by U.S. casino giant MGM Resorts International and Japanese financial services firm Orix. Osaka IR will apply for a license from the central government to open the first casino facility in the country.
Also on Thursday, the city of Osaka signed a fixed-term leasehold contract with Osaka IR for the planned construction site on Yumeshima, an artificial island in Osaka Bay.
When the prefectural government submitted its development plan to the central government in April 2022, the casino resort was scheduled to open around fall or winter 2029.
But the plan was delayed because it did not win central government approval until April this year, about six months later than prefectural officials anticipated.
Due to soaring material costs, the developer will initially need to invest ¥1.27 trillion ($8.5 billion) in the project, up from the previously estimated ¥1.08 trillion.
The resort is expected to reap ¥520 billion in revenue annually, of which about 80% is expected to come from the casino section.
Thursday's agreement allows Osaka IR to pull out by the end of September 2026 under given conditions, including the amount of initial investment exceeding ¥1.27 trillion.