MGM sets out final US$2bn funding plan for MGM Osaka

MGM says 70 per cent of the foundation piles are complete, as concrete and structural steel work continues at the development site.

Key takeaways

• MGM plans to invest JPY150bn-JPY160bn (US$950m-US$1bn) annually in MGM Osaka in 2027 and 2028. The company has invested JPY114bn (US$722m) so far.
• MGM expects to finance the payments primarily through available cash and free cash flow.
• Construction has reached 11 per cent completion, with approximately 70 per cent of foundation piles completed.
• MGM continues to target a 2030 opening for the project

Japan.- MGM Resorts International has confirmed that it will invest between JPY150bn and JPY160bn (US$950m-US$1bn) annually in MGM Osaka in 2027 and 2028. Speaking during MGM Resorts’ third-quarter 2026 earnings call on October 28, chief financial officer Jonathan Halkyard said the payments will adding to the approximately JPY114bn (US$722m) invested so far.

Responding to a question from CBRE analyst John DeCree about how the company would finance the contributions, Halkyard said MGM would primarily use available cash and free cash flow, although it could explore additional yen-denominated financing through its relationship banks. He confirmed that the wider development was fully funded through the financial commitments of MGM Resorts, its Japanese partner ORIX Corporation and a senior credit facility arranged in Japan.

According to Halkyard, the project is expected to open with leverage of approximately 2x, which he described as relatively low given the amount of equity being invested during construction. MGM could subsequently refinance the development before its opening or shortly afterwards, potentially allowing the company and ORIX to recover some of the capital invested during the construction phase.

The planned contributions will affect MGM’s capital allocation decisions over the next two years, particularly its share repurchase programme. Halkyard said the company had repurchased 250m shares over the previous three to four years without having to sacrifice other investment opportunities. He said MGM still intended to allocate capital to share repurchases but acknowledged that the Osaka investment would influence the amount available. The company had approximately US$1.4bn in remaining authorised capacity under its share repurchase programme at the time of the earnings call.

MGM Resorts president and chief executive Bill Hornbuckle said during the earnings call that approximately 70 per cent of the foundation piles at the MGM Osaka site had been completed, while concrete and structural steel work above ground was progressing. The overall development was 11 per cent complete at the time of the earnings call, with management maintaining its expectation of opening the integrated resort in 2030, he said.

Slides in the third-quarter earnings presentation compared the scale of the Osaka development with other major integrated resorts globally.

Frequently Asked Questions (FAQs)

• How much more will MGM Resorts invest in MGM Osaka? MGM Resorts plans to invest between JPY150bn and JPY160bn (approximately US$950m-US$1bn) annually in 2027 and 2028. The payments will complete its funding commitments to the development.

• How will MGM Resorts finance its remaining contributions? MGM expects to use available cash and free cash flow to finance its upcoming contributions. It may also explore yen-denominated financing through its relationship banks.

• When is MGM Osaka expected to open? MGM Resorts continues to target 2030 for the opening of MGM Osaka. The company reported that the overall development was approximately 11% complete during its third-quarter earnings call.