Chinese high rollers are not coming back to Australian casinos any time soon

Star’s gross VIP – high-roller – revenue for the entire 2021-22 year came to just $5.5m.

It seems that our two big casino groups Star and Crown have spent over $4bn to go toe-to-toe for a market that has simply evaporated.

Yes, taking their cue from the Kevin Costner movie, The Field of Dreams, they have “built it” – especially, very lavishly and expensively around the water in Sydney.

But unlike in the movie, “they” just “ain’t coming”.

At least not yet, thanks to Covid; but not likely anytime soon either, given the seemingly permanent frost that has settled over relations between the Land of Oz and the Middle Kingdom.

These are the billionaire Chinese high-rollers or ‘whales’ – and indeed even the mere multi-millionaire ‘medium-level’ rollers.

The first lot would come directly in their own corporate jets; the second via the ‘junket operators’ who earned the ire of assorted Royal Commissioners right up the east coast from the Yarra to north of the Tweed.

Star has given us the first numbers on the high-roller spend in Australian casinos since we re-opened the border in late-February and it is not pretty.

Gross VIP – high-roller – revenue for the entire 2021-22 year came to just $5.5m.

That was spread $4.7m in Sydney, and just $600k and $200k on the Gold Coast and Brisbane respectively.

Star’s gross VIP – high-roller – revenue for the entire 2021-22 year came to just $5.5m.

In the first half to December, when the borders were closed and Sydney had its last, long, lockdown, VIP revenues still totalled $1.8m and all of it in Sydney.

Obviously, all of it would have come from local punters. Therefore, in the second half, with the border at least theoretically open to Chinese high-rollers for over four months, the Sydney VIP take edged up to just $2.9m and the two casinos in Queensland got just $800k.

Compare that with the numbers in the last pre-Covid half-year, December 2019. Sydney got $139.5m in VIP revenue and the two Queensland casinos $14.6m.

With Crown disappearing into the belly of the Blackstone beast, we are unlikely to publicly see this sort of detail. But trust me, there is no way the Chinese whales have been flying over Sydney, just to come to Melbourne.

China’s zero-Covid policy has made it all-but impossible for them to come.

Further, even apart from Covid and heading deep into the future, any Chinese billionaire flying south would be putting one huge target on their back.

First off, is that frosting of relations. You’d be figuratively spitting in the eye of Chairman Xi, unless you were a relation.

Secondly, almost all that Chinese money that has been churned through local casinos had to escape from tough Chinese rules.

That was precisely why we saw all those ‘junketeers behaving badly’: it was mostly by the Chinese rules, trashing our rules was incidental. ‘Pre-frosting’ the Chinese authorities mostly looked the other way. Not now. Not in the future.

Indeed, it could be almost literally suicidal for a Chinese billionaire to turn up in a Star or Crown casino anytime soon.

Further, despite what the casinos have tried to claim over the years, it has always been all and only about China, and to a lesser extent the Chinese diaspora scattered mostly through Asia.

The latest Star numbers blow out of the water any suggestion of serious money for losing from anywhere else.

There ain’t no more Kerry Packers.

It all does rather make his son James look like both the smartest and luckiest man in the room.

He poured more than $2bn into Barangaroo – a casino only for high-rollers. He triggered Star to embark on its own $2bn-plus spend across its casinos.

Now he’s walked away with over $3bn, leaving Star and Blackstone with the bill and the empty high-roller rooms.

We know his father got his one Bond, Alan not James.

Now it seems James, that’s Packer not Bond, got his one Blackstone.