James Packer to build $5 billion Japanese casino: How he changed his business model
Monday, April 7, 2014/
Billionaire James Packer is set to build a $US5 billion casino complex in Japan, The Australian reports.
Packer’s joint venture, Melco Crown, is reportedly in talks with several Japanese corporations regarding the giant proposal. If constructed, the aim will be for the mega-casino complex to be ready in time for the 2020 Tokyo Olympics.
Crown executive Todd Nisbet told The Australian the project would be more elaborate than Melco Crown’s flagship City of Dreams resort, which is under construction in Macau.
“Japan is the biggest single opportunity that we are looking at in terms of an international expansion and growth story, just because of the sophistication of the market, the appeal of the overall area,’’ Nisbet said.
The Melco Crown City of Dreams resort is a five hotel-tower resort, partially designed by famed architect Dame Zaha Hadid.
It was reported that James Packer will visit Tokyo this week along with Prime Minister Tony Abbott and will speak about the company’s plans.
If the new Japanese casino comes to fruition, it will be one of a number of projects Packer’s company is involved in, solidifying Packer’s bold shift from media to gambling and entertainment.
His company is involved in building a new casino in Manila, as well as the $2 billion Studio City project in Macau, and domestically Crown Sydney in Sydney’s new Barangaroo development.
Packer told the Herald Sun his approach to casino success was not just about providing gambling facilities, but integrated resorts with accommodation, dining, retail and entertainment.
“These resorts are the biggest and most expensive and luxurious buildings in the world. That’s what they’ve become,’’ Packer told the Herald Sun.
He told the paper he decided casinos were more “scalable and exportable” than media companies. After inheriting around $5 billion from his father he initially focused on the media industry before taking a turn to casinos. He sold pay-TV company Consolidated Media Holdings to Newscorp for around $1 billion, and focused on the continued growth of Melbourne casino Crown Ltd.
Crown Melbourne is now worth around $7.3 billion, the Herald Sun reports.
Packer recently gave an interview to Forbes in which he revealed that despite his business success, his life was “not perfect”.
He ranked number 208 on the Forbes Billionaires list, and told the publication: “Business is good right now, but now my personal life is a disaster.”
He said the seed to focus on casinos was planted in childhood.
“As a kid I saw that dad lost a lot of money in casinos, and I didn’t understand that,” he told Forbes.
“I thought this must be a great business. At the same time, I saw when I was with him – and I was with him a lot of the time – that this was a really cool business, and it was fun and glamorous.”
However, casinos have not always been smooth sailing for Packer. Forbes reported that Packer invested large sums into casinos in Las Vegas, Pennsylvania and Canada, just before the global financial crisis.
“I lost a bunch of money in America because of the financial crisis,” Packer said.
It was estimated by Forbes his losses were as high as $2.6 billion, which is nearly half of his fortune.
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