South Korea's Kangwon Land Casino unveils $1.9B expansion, renovation project to triple casino space

Kangwon Land Inc., the company behind South Korea's Kangwon Land Casino, has revealed a new expansion and renovation project worth KRW2.5 trillion ($1.9 billion), for a new upscale casino resort including hotel and other property amenities. 

The project is expected to triple the dimensions of the property’s casino space by 2032. The fresh phase is said to have the working title of "K-HIT Project 1.0", with "K" standing for Korean, "H" means High Resort (which is the title of the whole compound at Kangwon Land), "I" means integrated, and "T" means tourism.

Under the plan, the gaming space of the resort would expand to 532,814 square feet to "address the current chronic shortage of [player] seats in the venue,” as per comments from Interim CEO Choi Cheol-Gyu. Out of the total sum planned to be spent on the expansion project, an overall KRW1.8 trillion would be spent on the gaming space. 

Since Kangwon Land, the only casino accessible to locals in the entire country, is located in a rural mountainous region located 3 hours east of Seoul, its promoters recently revealed intentions to extend the marketing efforts and appeal of the venue to attract an additional number of overseas players.

During his presentation, Choi noted that he expects a possible rival from the 1st integrated resort (IR) with a casino in Japan, MGM Osaka, although it’s officially scheduled to open in 2030.

Choi said: "Since Osaka’s integrated resort in Japan – just 90 minutes away [by air] from South Korea – will open in the future, Kangwon Land’s casino-for-locals monopoly status has effectively broken, therefore, we'd like to invest in a concentrated manner to strengthen [our] global competitiveness."

Furthermore, the revamped casino will include new VIP rooms with helicopters utilized to fly in Korean and international visitors. At the same time, a sky bridge will link the casino to the nearby High1 Ski and Golf Resort. 

As for the business goals related to the extension, they involve the renovation of the existing VIP casino establishments by 2027 and the increase of the maximum wagering limit of Kangwon Land.

Additionally, the new phase also involves a KRW270 billion ($200.7 million) hotel extension plan that will be financed from a total of KRW2.5 trillion ($1.8 billion), other establishments whose price is KRW280 billion ($208.1 million), and a fresh villa that includes a swimming pool which costs KRW30 billion ($22.3 million) in funding.

Furthermore, the presentation highlighted some of the future goals of Kangwon Land Inc. Those goals involved the recruitment of 3,400 employees; raising the amount of non-casino sales compared to casino sales (as a percentage of total sales) from 13% currently to 30%; raising the number of overseas visitors by 10 times; and increasing the yearly number of visits to the resort from the current 6.8 million to 12 million.

As informed by Choi, since the facility extension could take 7 to 8 years, the firm would establish an interim casino of 3,960 square meters close to the current property within 2 to 3 years at KRW80 billion ($59.47 million), according to the presentation.

Kangwon Land endured a slower than expected post-COVID recovery in 2023, with JP Morgan analysts attributing the slowdown to the proliferation of illegal and grey-market gambling such as cash play at "Hold’em" pubs, as well as online casinos.

Aside from the impending opening of Osaka’s IR, Kangwon Land also faces competition from the rising Philippine gaming industry and the potential legalization of casino gaming in Thailand.