Leading up to the final moment, lobbyists for James Packer’s Crown Resorts and Echo Entertainment have kept the pressure on the Queensland government which allowed both teams to jiggle-in final tweaks and enhancements to their casino license applications. Both companies are vying for the lucrative Brisbane casino license and the bidding war has created a situation where about A$3 billion will be spent by the winner and as many as 3,500 direct and indirect jobs would be created by construction and as many as 5,400 people would be employed.
Each is offering a tremendous opportunity for local and regional leaders to boost the economy and create a newly revitalized Brisbane, which would compete shoulder to shoulder with other world-class destinations.
This is not the first time the giants have come to loggerheads. Previously James Packer came up against the owners of the Star in Sydney when they tried to block his plans for a casino at nearby Barangaroo. Packer was front and center in that debate and even took out a 10% stake in Echo.
In the tussle over the Queen’s Wharf development it is reported that both sides have been instructed to not speak publicly, so the excitement on the street is a little more subdued with each milestone reached. The applications are in and the government is expected to announce the winner after the State Budget is made public on Tuesday.
Most high stakes casino bids don’t end when a winner is chosen, however, as the least “suitable” party often gives it the good old college try via lawsuits or other administrative procedures. Each side has invested untold amounts in their respective bids for the mega-project, essentially gambling millions of dollars.
Many analysts are predicting an Echo win this time for various reasons, not the least of which is the fact they already have licensed machines. Last week it was announced that Crown would like to buy between 1,500 and 2,500 machine licenses from local hotels and pubs. This could keep those opposed to expanding pokie numbers satisfied but all is not always as it appears.
The existing buy-back arrangements would need to be modified or a new “opt-in” program would need to be created. Trading hotel licenses through the surrender and tender process could fetch anywhere from $4,700 to $131,000 per license based on current local and statewide numbers but competition is the key to any price set as far as we can surmise. A report in the Financial review states that there is a cap of 19,500 machines for hotels, clubs are operating 24,500 licenses and 7,500 machines are in place among the existing casinos in the state.
Crown could conceivably acquire all of their needed licenses if given five years to do so with no need to increase overall numbers of licenses/machines.
Echo has enlisted Chow Tai Fook and Far East Consortium International Ltd. of Hong Kong as partners bringing deep pockets and liquidity. Crown has tapped Asian wealth as well by bringing Greenland Holdings on board.
The cards have been dealt, both players have shown the government their hands, and we may soon know who will hold the coveted Brisbane casino license.
The competing project’s websites, as presented on the Queensland Government’s webpage are: