Is Crown’s Sydney casino now in the good books?

After being found unfit to hold a casino licence in NSW, Crown Resorts is now confident it has done enough to have its gaming licence reinstated.

The casino giant says it has worked hard to address concerns raised by the state’s Independent Liquor & Gaming Authority (ILGA) and expects to have its high-end gambling rooms up and running from as early as May.

Crown executives have spent the last seven weeks ensuring its $2.2 billion Sydney hotel and ­casino meets the standards set by the ILGA.

Following the ruling handed down by former Supreme Court judge Patricia Bergin, the inquiry recommended that Crown revamp its management structure and conduct a “forensic audit” of its bank accounts. This was to make sure said bank accounts were insulated from “criminal elements”.

Furthermore, billionaire shareholder James Packer’s influence was to be curtailed.

Crown was told it met these conditions, it would be given the nod to move ahead with its Sydney casino.

Several of Crown’s top management have resigned in the wake of the inquiry and the Group has also introduced measures to mitigate against money laundering activity.

Further to this, Mr Packer has resigned and will take a backseat role in Crown operations.

While Crown is still being investigated across its Victoria and Western Australia assets,   ILGA chairman Philip Crawford told The Australian that Crown was making good progress in demonstrating it was fit to hold a NSW casino licence.

“We haven’t really nailed the timeline just yet but we’re talking months, not years,” Crawford said. “I would have thought the second half of this year is a realistic prospect (of Crown’s licence being restored) as long as they can get their structures in place.

“There’s still obviously a few variables, particularly the audit of the bank accounts. At the moment, that’s a critical issue and I’ve just got no idea how long that’s going to take. The accountants haven’t worked it out yet.”

While Mr Packer no longer has Board representation, the ILGA is liaising with Mr Packer’s company, Consolidated Press Holdings, about his  Crown shareholding.

The good news for Crown is potentially good news for New York private equity firm Blackstone Group, which last week launched an $8 billion takeover bid.

This was despite the inability of Crown Casino to open its doors in Sydney in December as scheduled and the lack of international custom due to the pandemic forcing border closures.

It should be noted, that Crown Sydney opened as a hotel only on 28 December.

Since the 350 room hotel opened, it has performed strongly due to domestic tourism.

“It’s outperformed our expectations in terms of demand over our first of three months,” newly installed chief executive, Peter Crinis said.

“For the first eight weeks, it was fantastic the amount of Sydney people and NSW people who decided to have a ‘stay-cation’ here.

“In some sense, it was kind of nice. It meant they got first crack at the property. If we’d had the full market, it would have been much harder to get in. It’s only really in the last few weeks we’ve started to see other markets coming in and a lot of interstate tourism.”

The precinct has also seen 160,000 diners through the hotel’s 10 restaurants, with 10-seat fine-dining room Yoshii’s Omakase booked out for weeks. The final fine dine venue, Oncore, by London restauranteur Clare Smyth, will open in May.

However, Crown Resorts cannot survive as a hotel and dining precinct. While, Mr Crinis expects all other aspects of the resort to be operational within two months, it is the casino that funds construction.

Irit Jackson, 30th March 2021