On Friday, the launch of the Midan City Resort Complex in South Korea was postponed by 12 months. The Ministry of Culture, Sports, and Tourism granted R&F Korea (RFKR), permission to delay the launch of the IR by 12 months, with the final date for the development of the resort being scheduled to 17 March 2023.
Last month, R&F Properties Co Ltd submitted a request to the South Korean Ministry of Culture, Sports, and Tourism to ask for a deadline extension of 24 months. While the operator did receive an extension of the deadline for the IR launch, it was allowed to postpone the launch of the resort by only 12 months, provided it met specific conditions.
R&F Asks for IR Launch Delay for Second Time, Company Unable to Meet Deadline Yet Again
RFKR is the local subsidiary of the Hong Kong-listed Guangzhou R&F Properties, which became the only owner of the IR project in 2021. The company gained full control over the project after it bought the 50% stake of its company which was previously held by the US-based casino juggernaut Caesars Entertainment.
Last month, RFKR asked the Ministry of Culture, Sports, and Tourism of South Korea to grant a 24-month delay of the deadline for the launch of the IR in Incheon, until March 2024. This was the second time the company has made such a request, with RFKR asking to postpone the launch of the IR by three years shortly after it became the sole owner of the project in 2021.
While the first request was denied, the Ministry of Culture, Sports, and Tourism granted the company a 12-month delay, with the IR project scheduled to be finalized by March 2022. RFKR was allowed to postpone the launch of the Incheon IR with the proviso that it paid KRW30 billion (US$27 million) to the construction company working on the project. This amount had to be paid as a cost owed to the construction company, Ssangyong E&C, which had stopped working on the IR project in February 2020.
However, as the company was unable to complete the project on time, last month, it requested yet another delay until 2024. Despite failing to meet the requirement of paying the aforementioned amount to the construction company, in its newly submitted request, RFKR included a 5% increase in the project budget.
R&F Receives Another Delay for IR Project, Midan City Complex to Launch in 2023
After the Ministry of Culture, Sports and Tourism of South Korea considered RFKR’s request, it decided to allow another 12-month extension of the deadline for the launch of the IR. According to Gyeonggi News, the additional extension was granted only with the proviso that RFKR meets the condition of increasing its project budget by 5%.
While the company did not receive the requested extension of two years, there are speculations that it may ask for another delay once the new deadline expires in 2023. There are reports that the 5% boost in the project’s budget will most likely be generated through RFKR selling some or all of the properties it owns in Midan City.
The Midan City Resort Complex is planned to offer a casino exclusively available to foreigners, 751 hotel rooms, a convention space, and a theater. Even though RFKR was granted yet another extension of the deadline for the launch of the IR, there are many concerns about whether the company will be able to fund the project and finish on time.