Crown Sydney one step closer to reality: Gaming - gambling - property billionaire James Packer gets green light to build casino at Barangaroo

Crown Sydney once step closer to reality: Gaming - gambling - property billionaire James Packer gets green light to build casino at Barangaroo - 4th July 2013

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Australian casino news: Gaming - gambling - property billionaire James Packer gets green light to build casino at Barangaroo; Sydney, Australia...

Australian billionaire James Packer has been given the go ahead to move ahead and build Sydney's second casino at prime location Barangaroo.

The decision by the NSW government means Crown moves to the final stage of the approval process.

Premier O'Farrell announced Mr Packer's Crown would pay an upfront licence fee of $100 million; that non-rebate gaming would be taxed at 29 per cent - not the 27.5 per cent proposed by Crown and "the total of licence fee and gaming tax payments to NSW over the first 15 years of full operation must exceed $1 billion, a guarantee Crown proposed for its alternate option.

"Growing tourism[is] an important part of our strategy to achieve economic growth," the Premier told the media conference.

The O’Farrell government made its decision after considering a detailed report by a government appointed panel led by former banking chief David Murray.

The report weighed up the Crown proposal and Echo Entertainment’s $1.1 billion plan to transform The Star at Pyrmont into a massive integrated resort, featuring two new luxury hotels.

The NSW Premier advised the Crown proposal had been more lucrative for government than the proposal from Echo Entertainment's The Star Casino for an upgrade.

Mr O'Farrell said Mr Murray had found in his review that "competition" would improve the tourism and gaming dollar in NSW and that was why the Premier had decided to greenlight Mr Packer's casino.

"More important than the benefit of the proposal . . what was clearer and the major determining factor of the recommendations was the need to inject competition into this area," the Premier said.

"The committee discovered that relative to Melbourne we were underperforming in an area where there was $34 billion a year on offer."

Negotiations would now take place to complete an agreement on the proposal.

Mr Murray said only if those negotiations broke down: "If at some stage then there's not agreement the government should move to a tender process after that."

The win concludes a 19-year wait by the Packer family to enter the Sydney casino market after the late Kerry Packer missed out on being awarded Sydney's first licence to the Showboat-Leighton consortium in 1994.

Under the Crown grand plan, a $1.5 billion, six-star casino resort will be built in Barangaroo, ending The Star’s Sydney casino monopoly which is due to expire in 2019.

The 60-storey, 250m tower will include multimillion-dollar penthouse apartments, as well as private VIP gaming suites, signature restaurants and bars, luxury sundecks and an infinity pool.

It will not include poker machines aka "pokies" and gamblers will have to apply to join a Crown membership club to be able to play.

The 350-room hotel will be one of the first new hotels built in Sydney since the Sydney Olympics in 2000.

Winning a Sydney licence has become a deeply personal mission for James Packer, who has campaigned vigorously for almost a year to stamp his Crown brand across his hometown.

He wants the Barangaroo venue to be Crown’s international jewel, as it expands further from Macau into new other Asian markets such as Sri Lanka, the Philippines and possibly Japan.

For the O’Farrell government, Crown’s promise to building something truly iconic helps shape the politically sensitive development of Sydney’s last remaining city waterfront precinct.

The Barangaroo plan enables public access to the entire harbour foreshore for the first time since the 1970s. About half of the 22ha precinct will be public space with the northern most point to be reshaped into a park taking the form of the space before European settlement in 1788.

Mr Packer’s pitch also included promises that the new resort would be developed to such a standard that it would become an “architectural postcard” to help boost tourism to NSW, especially from the rapidly expanding Chinese middle-class.

British architects Wilkinson Eyre, which created Singapore’s acclaimed Guangzhou International Finance Centre, won a $10 million international competition to design the tower.

Its winning design’s curves and fine lines take their inspiration from three petals.

Mr Packer won support for his plan from former prime minister Paul Keating, who has been a vocal proponent of ensuring Barangaroo is developed sensitively.

The battle between Crown and Echo has heated up in recent weeks with Echo chief executive John Redmond accusing Crown of wanting to build a “casino tower on steroids” rather than a true VIP-only facility.

Echo offered to go ahead with its $1.1 billion investment even if Crown won a Sydney licence, as long as its casino was restricted to what is known in the industry as International Rebate Business.

But in a blow to such a compromise, the Premier indicated last week it would be “impossible” to work out a way to enable both plans to go ahead.

Echo's plan also included an offer to pay the NSW government $250 million if it rejected the Crown plan and enabled The Star to extend its monopoly status for another 15 years from 2019.


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