The Star Secures Brisbane Project Financing
Companies must move forward despite the pandemic, if they are able to do so. The Star Entertainment Group decided to do just that with regard to its Queens Wharf Brisbane project.
Last week, the company executed its funding agreements with its project partners. That secures the $1.6 billion in debt funding, the first of it to be used next month.
Funding Announcement
The Star Entertainment Group completed the execution of its $1.6 billion project-level debt funding for Queens Wharf Brisbane. The Star did this in joint partnership with David Chiu’s Far East Consortium and Henry Cheong’s Chow Tai Fook Enterprises.
The terms of the agreement were determined prior to the COVID-19 pandemic and ensuing economic crisis, which means the financials and terms reflect the market conditions at that time. All necessary conditions for the funding, including the final approval of the Queensland government, should be completed next month.
Once complete, the joint partnership will take the first draw-down on the funding, the rest remaining for construction that is set to begin in early 2021. In total the group’s funding is a 5.5-year agreement with three years of operations allowed before refinancing.
Ongoing and Ongoing Project
The Queensland government initially approved the Queen’s Wharf Brisbane development in late 2017. Originally thought to be a $3 billion project, the Destination Brisbane Consortium wanted to build an entire new residential complex, restaurants and bars, hotels, casino, and retail space.
Covering 27.3 hectares of land and across water along the Brisbane River, the project would use some existing buildings and build new structures, ultimately connecting it all to the South Bank Parklands across the river with a pedestrian bridge.
Construction crews finally broke ground on the project on March 8, 2018. And according to the website dedicated to the project, The Star still expects to open at least a part of it in 2022.
The last update before the pandemic indicated that Fitzgerald Constructions Australia was prepared to start the construction of the Neville Bonner Bridge, which will connect South Bank to the Queen’s Wharf Brisbane. While some of that progress was stifled by the shutdowns surrounding the pandemic, workers do have a schedule that started this month. They will be working at night during May and June “while critical work is undertaken and to achieve required social distancing practices due to COVID-19.”
Since the start of the project, the property took on a bit more size and scope, increasing its value to $3.6 billion.
Details about the Opening
That 2022 date is, more specifically, late 2022 and could be pushed into 2023 if the pandemic slowdown impacted the project severely.
At that time of the first opening, the landing and wharf facilities will be the first to open. At least some of the residential apartments will be for sale and prepared for residents to move in, and at least some of the thousand-plus hotel rooms will be open for guests. It is unclear if the new ballroom will be open at that time.
Though it is not currently known if the casino will be a part of the grand opening, but the move from the Treasury building to the fifth level of the arc-shaped building in Queen’s Wharf integrated resort will be complete. The gaming floor will comprise less than 5% of the overall development, it will be a state-of-the-art facility.
The details of the casino development are not a current focus of the project’s coordinators. The Star is more concerned with updating the public on the process and making them feel a part of it. And it wouldn’t hurt to drum up interest in the apartments. They are likely to be quite expensive but also elegant and very modern.
Layoffs and New Jobs
The Star believes that Queen’s Wharf Brisbane will create approximately 8,000 jobs once the integrated resort is fully operational. Meanwhile, many in the construction field are employed to build it.
That is a positive, but it stands in stark contrast to the employees stood down over the past two months due to the pandemic. The Star stood down about 90% of its employees throughout Australia during this time; many thousands of people are out of work.
As companies do begin to welcome employees back – slowly, over time – it may take months or even years to bring business back to the levels seen prior to the pandemic. This means that some of the employees will not begin work again soon.
The Star Entertainment Group must look to the future and build for long-term success, but it doesn’t give much hope to the people still out of work from the jobs with The Star today.
