Provided by NZX
  • SKC3.84

    $0.030.78%

  • Open 3.87 High 3.87 Low 3.81 Bid Price 3.83

    Offer Price 3.84 Value 5272971.63 Volume 1368542

Current as of 23/10/14 07:40PM NZST

Anne Gibson

Property editor of the NZ Herald

Big bills on cards for SkyCity

SkyCity is in a consortium bidding to build a new casino and tourism centre on the Gold Coast tipped to cost up to $1 billion. Photo / Steven McNicholl
SkyCity is in a consortium bidding to build a new casino and tourism centre on the Gold Coast tipped to cost up to $1 billion. Photo / Steven McNicholl

SkyCity Entertainment Group could be up for $500 million if it wins the right to build a new Gold Coast casino, cruise ship terminal and tourism project, an expert estimates.

Morningstar analyst Nachi Moghe said the project to develop a second Gold Coast casino could cost $800 million to $1 billion.

SkyCity is in the Azure Consortium with Brookfield Multiplex, which is is vying for the right to develop the Queensland site.

The company would be up for half the cost if it won.

But Moghe said there was no certainty about the deal because three other parties had also made a bid for the project.

Queensland's state government has a shortlist of four bidders, and SkyCity chief executive Nigel Morrison said this week that Azure had submitted a preliminary proposal for a world-class integrated tourism development to the Gold Coast City Council and the state.

The Gold Coast has Jupiters Hotel and Casino at Broadbeach, but officials want a second venue at the Broadwater and Spit nearer Labrador to the north.

Moghe said the cost of a new licence alone could be around $200 million but the total project cost would depend on whether an integrated gaming complex was built.

"Obviously SkyCity's share would be half that cost, but still quite substantial," he said.

He predicted that if Azure won, SkyCity's plans to go to Asia, announced a few weeks ago, would most likely be ditched because of the amount of capital expenditure on its books.

Morrison said the company was looking at moving into the thriving Asian market, opening a giant venue in the Philippines in what could be a $200 million venture - which would take planned capital expenditure to almost $1 billion.

Morrison said the company saw huge growth opportunities in Manila, and might make a move this year.

But Moghe said those plans might not come to anything if the company got the green light in Queensland which would be a huge bonus to its business.

"SkyCity could get international VIP visitors to the Gold Coast, Adelaide, Auckland and Queenstown providing them with variety. I think that's the idea," Moghe said.

SkyCity is also planning big changes to its Queenstown operation, looking to add accommodation and VIP suites, as well as starting work soon on an upgrade to its Auckland SkyTower, developing further restaurants and reconfiguring the main entry.

Rolling dice

SkyCity's potential spending:
*$350m: Auckland International Convention Centre
*$500m: Gold Coast casino and tourism project
*$435m: Adelaide expansion and redevelopment

- NZ Herald

© Copyright 2014, APN New Zealand Limited

Assembled by: (static) on production apcf02 at 24 Oct 2014 03:14:53 Processing Time: 551ms