Fresh from out-muscling Echo Entertainment in Sydney, James Packer now intends to take on his rival’s casino monopoly in Queensland.
Echo’s The Star lost its exclusive license in New South Wales earlier this month when Crown was given the conditional go-ahead by the state government for development of a A$1.5 billion gaming resort with a luxury hotel on Darling Harbour within sight of The Star. Crown Sydney plans to open in 2019, when The Star’s monopoly expires.
Packer and the NSW government have made much of The Star’s poor performance attracting high rollers, in contrast to Crown’s strong history in the sector at its flagship Crown Melbourne casino in neighboring Victoria.
The billionaire is now plying the same argument in Queensland, saying Echo is doing a terrible job at maximizing the potential of its Jupiters casinos on the Gold Coast and in Townsville and the Treasure in Brisbane.
“The quality of the properties in Surfers Paradise and Brisbane are a disgrace,” he said on the Financial Review program on Nine Network, which he used to own.
“And I think that I am amazed still,” he added, “that Echo contracted and announced publicly with the government that they were going to spend $600 million on Jupiters three years ago and got increased gaming capacity as a result of that deal and have spent no money so far.”
Packer’s pitch for a license in Brisbane has turned up the heat on Echo, which is pushing for support for a new resort casino of its own in the city’s central business district. Chief Executive John Redmond has said he wants to invest $1 billion and has his eye on the same piece of prime waterfront development land as Crown. Echo says there is not enough demand for a second casino and will only invest if its exclusivity in the city is assured, effectively blocking a play by Crown.
Queensland Tourism Industry Council Chief Executive Daniel Gschwind, said the state-led revamp of the George Street precinct was an ideal opportunity for an “expanded entertainment facility”.
“We would certainly like to see an opportunity that is supported by the private sector to have an additional entertainment precinct, with retail and other entertainment opportunities, with possibly a hotel facility,” he said. “I think it would revitalise that particular area which I think is a little bit dull and uneventful at the moment.”
Lord Mayor Graham Quirk likewise acknowledges the need for “high quality attractions” to “ensure people stay and play … So I’m supportive of a world-class casino that will bring high-roller investors to Brisbane,” he said.
The Queensland government is conducting a review, due in September, on whether a casino is an appropriate use of the development site.
“It will be interesting to see where Premier (Campbell) Newman ends up on the ideological question of competition,” Packer said.
The government says it is keen to negotiate with both parties.
