Sandwiched by forested hills and the Great Barrier Reef, the town of Cairns and its surrounding region are enduring a tourist slump. More than a third of the 3,892 hotel rooms in the tropical Australian getaway were empty in the three months through June.

Hong Kong investor David Ficklingg has plans to reverse that with a A$4.2 billion ($4 billion) casino resort, complete with artificial lagoon, 18-hole golf course and 25,000-seat arena. The complex will almost double the number of hotel rooms in a region where oversupply has fueled an rates since 2007.

Companies including billionaire James Packer’s Crown Ltd. and Echo Entertainment Group Ltd. are studying plans to expand or add casinos in Cairns’ home state of Queensland to lure Chinese tourists away from Macau, the world’s largest gambling hub. A record 110,100 Chinese arrived in Australia in February, more than double the 42,600 who came during all of 1995, and China is now the country’s biggest source of tourist revenue.

“Whether they gamble or not, casinos are one of the prize attractions” for Chinese tourists, said Justine Chien, director of Sydney-based tour agent Golden Dragon Travel Pty. ‘They’ve all been to Macau already. They want to see the different casinos around the world.’’

Global Competition

Queensland, more than twice the size of Texas and with a shoreline longer than India’s, is seeking to emulate Singapore. Asian tourists to the city state helped Genting Singapore Plc and Las Vegas Sands Corp. resorts draw $5.85 billion in revenue in 2012, according to Bloomberg Industries data.

“We’re in a global competition for tourists and the offering we have at the moment, I’m afraid, is not up there with our competitors,” Queensland Premier Campbell Newman said Oct. 14 while announcing plans to offer as many as three new casino licenses. “The infrastructure that we have in this state is from a different era.”

Other Asian countries are moving in the same direction. Melco Crown Entertainment Ltd. wants to build casino resorts in Japan and the Philippines amid Macau land and labor constraints, Lawrence Ho, Packer’s partner in the joint venture, said in a Sept. 28 interview. Crown is also planning a resort in Colombo that would create 2,600 jobs, Sri Lanka’s government has said.

Queensland’s government is the nation’s most indebted, with a deficit forecast at about $7.3 billion for the 12 months ending June. The state now has four casinos.

“A decade ago most cities were happy to have just one,” said Sacha Krien, a CLSA Asia-Pacific Markets analyst in Sydney. “Now with budget pressures a number of them are considering allowing new ones or expanding the ones they have.”

Sydney Changes

With at least one casino in every state and territory of Australia, no new license has been granted since 1996. That’s changing. Crown’s planned $1.2 billion venue overlooking Sydney Harbour was moved to the final stage of a three-step approval process by the New South Wales state government in July. That’s a threat to Echo, which has been trying to lure Chinese high- rollers by sprucing up its nearby Star casino.

Packer is interested in taking on Echo in Brisbane too, he said Oct. 1.

Queensland will welcome applications for redeveloping a riverfront site in the state capital, which includes Echo’s existing Treasury casino, Newman said in an e-mailed statement Oct. 14. The state can sustain two more Singapore-style integrated resorts, he said.

Treasury is too small to attract enough tourists, according to Echo’s Chief Executive Officer John Redmond.

Ridong Out

“It’s a casino, it’s not a resort destination,” he said in an Aug. 22 interview. “You need to build or develop something at a scale that allows you to be able to compete with the rest of the world.”

Redeveloping the area could cost A$2 billion, Credit Suisse Group AG analyst Larry Gandler wrote in a Sept. 18 note to clients. With “proper planning and design,” a resort built to an equivalent standard would cost about A$700 million, Redmond said in an Feb. 21 investor call.

A 50-minute drive to the south of Brisbane, the Gold Coast city council says it hopes to build another casino resort and cruise ship terminal on an artificial island in a coastal lagoon. Four groups put in applications for what the government calls a “potential multi-billion dollar” project.

At least one has walked away. Uncertainty about whether a license would be granted led Ridong (Gold Coast) Development Pty., owned by Chinese property developer Zhuhai Ridong Group Ltd., to back away from plans to invest more than A$10 billion, Steven Haggart, the unit’s CEO, said by phone on Sept. 24. He didn’t immediately return a message left today on his mobile phone asking if Ridong’s position has changed.


New projects, in particular Fung’s Cairns casino, still have the “potential to reinvigorate Asian tourism” in the state, home to 29 percent of the Australia’s hotel beds, said Matthew Jones, director of Liquor & Gaming Specialists Pty., a Brisbane-based consultancy.

“If someone is prepared to build something of a much higher standard, that’s going to encourage more visitors,” he said by phone.

Fung’s Aquis is the most ambitious so far. With 3,750 hotel rooms as well as 1,335 villas and apartments according to its plan, it could accommodate more people than Singapore’s two integrated resorts put together.

That may be a stretch, said Justin Casey, managing director of Macau-based Asia Pacific Gaming Consultancy.

“Everyone’s got a marble floor, chandelier and a Chinese restaurant now,” he said. “If you had a pocket full of money and you were looking to establish a new destination in Asia, I don’t know Australia would be the first cab off the rank.”

Editors: Anjali Cordeiro, Ben Richardson. To contact the reporter on this story: David Fickling in Sydney at To contact the editor responsible for this story: Stephanie Wong at