Star Entertainment’s Matt Bekier has achieved the dream double of maintaining his monopoly casino on the Gold Coast without having to commit funds in return for the promised exclusivity.
The Queensland government’s decision to suspend its Gold Coast tourism hub venture makes sense given the economic uncertainty but for Bekier it is a dream come true.
Far better to make a decision on this basis than impose artificial constraints handing the behemoth privileged status.
Star had committed to spending its own money to expand the Broadbeach Convention and Exhibition centre in return for a 30-year monopoly on the Gold Coast.
Economically it made no sense for the government to lock potential competitors out of the site no matter how dire the economic conditions are.
For Bekier it’s been a good couple of months despite the calamity of having his venues closed due to COVID-19.
He has obtained extra funding for the $2.6bn Queens Wharf casino development due to open in late 2022 and now has exclusivity on the Gold Coast.
At one stage James Packer was threatening with rival projects but after losing to Star in the Queen’s Wharf development Crown has had its attention diverted to its domestic issues including uncertainty over its ownership.
The NSW government has also given him casino exclusivity for poker machines for the next few years.
All of which plays into Bekier’s hands.
While Crown’s Melbourne casino is closed Bekier’s resorts are reopening, albeit in still limited trading.
Sydney is the flagship producing 60 per cent of earnings in normal times.
Crowds are well down in part due to the restrictions but it seems that after having been locked out patrons are more eager to spend their money.
The Sydney casino has around 5500 people a day in its house down from 30,000 at its peak, and the Brisbane and Gold Coast casinos are running at 50 per cent capacity.
Star generates around 85 per cent of its earnings from domestic trade which is just as well given the international market is blocked for the foreseeable future.
Star is trying to generate traffic from Australian-based big spenders to offset the loss of Chinese “whales”.
The company stood down 8600 of its 9000 staff back in March when the nationwide shutdown started and it now has 6000 back on the job.
In five years time a rival may decide to open up on the Gold Coast but by then Star would have spent $2bn on its expansion so has the advantage of being a much better entrenched casino.
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