Proposed Six-Star Casino Complex Targets Mainland Chinese Market
Are luxury hotels, high-end retail, and casinos the best way to cater to the rise in Chinese tourists? That might be the way forward for major Australian cities. Shuk-Wah Chung reports from Sydney.
If billionaire James Packer could design Sydney, he’d model it after Singapore.
In 2010, as the global financial crisis was starting to recover, Singapore’s GDP grew a phenomenal 14.5%, which the Australian businessman attributes to the opening of two integrated hotel and casino resorts, Marina Bay Sands and World Sentosa.
At the recent fashion and luxury Bespoke summit in Sydney, Packer said:
“The fact that Singapore’s all time record GDP growth year was when the two integrated resorts opened, I think is the most clinical example you can find about what these projects can do for a city.”
Heir to one of Australia’s wealthiest and most influential families, Packer is no stranger to the gambling industry. Whilst his family made its fortune in media, Packer’s father was known for his own gambling habits and to be involved in a number of gambling and tourism businesses including the largest casino in the southern hemisphere, Crown Casino in Melbourne.
Packer, who is moving away from his media legacy to focus on building the Crown Limited gaming and entertainment company, is setting his sights on a new six-star luxury and lifestyle hotel and casino on the Barangaroo harbourfront site. With views overlooking the iconic Sydney Opera House and Harbour Bridge, and plans to fill it with “celebrity chef” restaurants, Packer’s main aim is to draw in a certain audience: Chinese travelers.
“I think that the rise in the Chinese middle class is one of the profound changes that is occurring in the world and in all probability will continue to occur in the next several decades,” said Packer at Bespoke, whilst unveiling renderings for the sleek, silver, structure that will transform Sydney’s horizon.
Packer also went on to say:
“The world of tourism, if you look at it dispassionately, is very much about manmade attractions. If you look at America, the three largest tourist destinations are New York City, Orlando, and Las Vegas. [In] Asia the largest tourist attractions are Hong Kong, Macau, and Dubai.”
Although apart from the urban jungle of Sydney, the tourism image of Australia is usually about its unique wildlife, beaches, and great outdoors, Packer is definitely on the right track if he wants to capitalize on Asia’s growth.
According to Swiss private banking Julius Baer Group, by 2015 China will become home to half of the wealthiest people in Asia; and in 2012 it was revealed by the Hurun Report and Group M Knowledge that China currently boasts a million millionaires.
Part of Australia’s tourism objectives, as noted in last year’s Australia in the Asian Century White Paper, aim to “encourage more tourists from emerging markets, from China in particular.” They also acknowledge that“This will mean developing sophisticated luxury urban tourism opportunities, such as those offered by Crown Limited, as well as showcasing Australia’s outstanding natural beauty.”
But if Packer is looking towards Singapore as inspiration, it should also be noted that its gaming industry is already slowing down, with the two casino operators Las Vegas Sands and Genting Singapore reporting low third-quarter earnings in 2012.
A Bloomberg report notes:
“We have been waiting for the novelty factor of Singapore’s casinos to finally wear off, and that time may have finally come,” said Jonathan Galaviz, managing director of Galaviz & Co., a Las Vegas-based tourism industry analyst.
Whether a new casino in Sydney will be enough to bring in tourist dollars from “Asian high rollers” is a gamble in itself. In the meantime, Packer is campaigning to get this project green-lighted, going head-to-head for government approval with the rival Echo Entertainment Group.