Echo Entertainment and James Packer’s Crown Resorts battled it out to secure rights to construct a $3 billion mega-casino resort at Queen’s Wharf, Brisbane. The Queensland government eventually decided that Echo Entertainment’s proposal was more suitable to what they envisioned when compared to Crown Resorts and turned over the project to Echo Entertainment in July 2015.

Echo Entertainment has partnered with two Hong Kong based companies namely Chow Tai Fook Enterprises (CTFE) and Far East Consortium to construct and develop this mega project which is expected to be completed by the end of 2022.  Echo is expected to contribute 50% of the revenue and the two Hong Kong firms will chip in with 25% each.

Chow Tai Fook Enterprises which is owned by Hong Kong billionaire Henry Cheng has diversified business interests spread across a number of industries such as shopping malls, jewelry and real estate. CTFE has also committed to building a casino resort at the Incheon Free Economic Zone in South Korea and will invest around $2.6 billion in the project.

Chow Tai Fook Enterprises is relying heavily on its VIP network of Mainland Chinese investors to raise funds for its Brisbane project as the company believes that the Australian market has enormous potential for development. The slowdown in China’s economy will pose a challenge for the companies to find high profile investors willing to make significant contributions.

Beijing’s anti-corruption crackdown targeting VIPs and their source of funds has also deterred a number of wealthy Chinese from coming forward to invest as they would have to be transparent with the source of their income. However Chow Tai Fook Enterprises has built up a network of 1.7 million VIP customers over the years and will leverage its relationship with these VIP customers to find serious investors for its Brisbane project.

In a statement found on the SMH, Patrick Tsang, CEO of Chow Tai Fook Enterprises said “The current slowdown, of course we are feeling it. We have a retail business, we have a real estate business but overall for the longer term we’re bullish on China. Hopefully the crackdown will result in a better system for the longer term which is better for the country. We’re heavily invested in China so we’re quite confident things will work out.”

 

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