The long-awaited launch of Star Entertainment Group’s AU$3.6 billion (US$2.5 billion) Queen’s Wharf Brisbane development will now take place sometime in the latter half of 2023, delayed from previous guidance of a mid-year opening.
The ambitious project, which covers almost 10% of the Brisbane CBD, is a joint venture partnership between Star – which owns a 50% stake – and Hong Kong-listed firms Chow Tai Fook Enterprises and Far East Consortium with 25% each.
When complete, Queen’s Wharf will offer four world-class hotels, 50 restaurants, cafes and bars, 12 football fields of public space, and up to 2,000 residential apartments. It will also replace the old Treasury casino with a new and expanded gaming space.
In a trading update on Friday, Star said the delay was due to the impact of COVID-19 as well as higher than average rainfall throughout the past year, with development costs also 10% higher due to escalating construction material costs, labor shortages, supply chain challenges as well as the inclusion of capital equipment required to open the development.
The additional cost would be funded, Star said, by higher equity contributions from all three companies.
However, discussions are ongoing with developer Multiplex over exactly how much those costs should be given provisions within the contract for liquidated damages payable on key milestones (as adjusted in accordance with the contract).
“The expected additional costs may be adjusted depending on the outcomes of the ongoing discussions with Multiplex, including regarding liquidated damages,” Star explained.
The delay to Star’s flagship development comes with the company in the midst of a regulatory inquiry into its Queensland operations, coming in the wake of a similar inquiry recently held in NSW into The Star Sydney.