Sydney's Crown Casino Is At Risk

Sydney’s Crown Casino is at risk. Sydney witnessed the opening on Monday this week of what could be the 21st century approximation of the popular beer-free pub of Slim Dusty: the casino of James Packer without gambling.

Restaurants, bars and the “six-star” hotel opened their doors at Crown Resorts’ new $2.2 billion complex in Barangaroo for the first time, but with none of the pomp or fanfare imagined when the 275-metre tower was first proposed eight years ago.

The NSW gambling regulator blocked the $6.5 billion ASX-listed giant from commencing gaming operations in December after its failures to prevent money laundering at its Melbourne and Perth casinos and other probity issues were revealed during a public inquiry into the group.

Crown’s casino licence now hinges on former Supreme Court judge Patricia Bergin‘s findings from the year-long investigation into the group, which was triggered by a series of reports by this masthead. The recommendations are due by February 1.

The risk, according to gaming industry experts, is that even after Australia’s international borders reopen the Chinese high rollers that were a vital part of the Barangaroo business plan are unlikely to return.

“The international VIP market is pretty much gone,” says David Green, an industry consultant who has worked with both casinos and gambling regulators.

“These people won’t put their heads up again while the mainland [Chinese] authorities are as belligerent and antagonistic towards gaming as they now are.”

When Packer first proposed the project in 2018, he made it clear having a high-roller, members-only casino attached was crucial to its viability and that China was the biggest opportunity.

Crown promised the NSW government that Barangaroo would deliver $1 billion in tax revenue in the first 15 years of operation. The casino would triple the value of international VIP gaming business coming into Sydney, Packer claimed. But in October, while giving evidence to the Bergin inquiry, he conceded that would never eventuate.

“Clearly that’s wrong but that’s what I believed at the time,” Packer told the Independent Liquor and Gaming Authority (ILGA) inquiry.

The billionaire businessman explained that in the original business case international high rollers would generate a third of Crown Sydney’s earnings, with local gamblers and its hotel and hospitality operations making up the balance covering the cost of construction.

“The upside in Crown Sydney was from the international VIP business,” Packer said.

[image: Crown Sydney]