Inside Asian Gaming

inside asian gaming August 2015 26 Cover Story leading domestic tourist destination. Jupiters, with 79 tables and 1,650 machines, was slated for up to A$250 million in improvements during Echo’s fiscal year ending 30th June, including refurbishing its current 592 rooms, upgrading and expanding VIP gaming suites and beginning construction of a new upscale hotel tower as part of a full facelift for the resort. LANDING VISITORS Government estimates project Queen’s Wharf will boost Brisbane tourism by 1.39 million visitors when completed and increase tourist expenditures by A$1.69 billion annually. “The center of casino gaming in Australia will shift from Victoria to Queensland,” Mr Kale says. “Punters visiting Queensland will have a choice of casinos whereas those visiting [Crown’s flagship property in] Melbourne will not have any choice.” Not everyone believes Queen’s Wharf will be a magic bullet for international visitors. “I doubt that a new casino IR in Brisbane will make a significant difference to foreign tourist visitation to Australia,” Mr Green says, “but it will certainly be a draw for interstate visitors, and for those who might otherwise find Brisbane unsuitable for more than a transit stop. It could certainly help prolong length of stay by people who visit the city.” No doubt, though, winning Queen’s Wharf gives Echo a huge lift. Losing would have left it stuck in the Treasury facility, hosting 83 tables with about 1,500 machines, but virtually no VIP traffic, overwhelmed by the IR next door, putting nearly one-fifth of Echo’s EBITDA at risk. “The challenge with Treasury is there is nothing you can do within the footprint of the current heritage site,” Mr Bekier told Australia’s Fairfax Media, explaining the dearth of VIPs. “That’s why [Queen’s Wharf] was important for us. We believed we could very much transform the earnings potential of this location if we could move to a new site.” With the IR, Echo hopes to keep narrowing Crown’s lead in Australia’s VIP market. Mr Bekier predicts VIP revenue at Queen’s Wharf will match the 30% share achieved at The Star in Sydney, amounting to about A$400 million last year. Crown’s VIP revenue shares in the first half were 27% in Perth and 43% in Melbourne for a six month total of A$500 million. In the shorter run, Morgan Stanley estimates Australia and New Zealand will grow their share of the Asian VIP market from 4% last year to 6.8% in 2017. Analysts King Goh, Andrew McLeod and Mark Goodridge in Australia and Praveen Choudhary in Hong Kong suggest four key reasons for the surge. Australian casinos are liberally providing credit to junkets and paying 1.6% commissions compared to Macau’s 1.25%. Crown and Echo have each spent A$1 Announcing the selection of Destination Brisbane, Queensland Premier Annastacia Palaszczuk said the Queen’s Wharf redevelopment will change Brisbane with iconic infrastructure to enhance its place on the international stage. The Brisbane IR will also create a bookend to Echo’s Jupiters Gold Coast casino resort, 85 kilometers (51 miles) away in Australia’s leading domestic tourist destination. Jupiters, with 79 tables and 1,650 machines, was slated for up to A$250 million in improvements during Echo’s fiscal year ending 30th June. Jupiters Gold Coast