State Govt ups pressure on casino
The State Government was preparing contingency plans in case the Adelaide Casino scrapped its redevelopment long before last week’s statement to the stock exchange by casino operator SkyCity.
The Government is in discussions with SkyCity this week about the future of its Adelaide operations and it has decided to turn up the heat.
SkyCity’s results statement last week noted a “disappointing” performance in Adelaide and said its plans for starting construction of a long-mooted $350 million redevelopment were “uncertain”.
Today it’s been revealed that the Government was concerned about SkyCity’s commitment to the redevelopment well before its statement to the ASX.
The Government today released contingency plans prepared for the Adelaide Riverbank Authority board meeting on 27 July 2015 that show development options for the space to the north of the Casino, should SkyCity’s touted six-star boutique hotel plans come to nothing.
The concept development plans – in reality, nothing more than very basic conceptual drawings – show a number of low-rise options for the area, which the Government sees as a key part of its Festival Plaza redevelopment.
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With negotiations underway this week, the release of the document is clearly an attempt to pressure SkyCity into making a positive decision.
Deputy Premier John Rau refused to say how long he had harboured doubts about the casino’s commitment to its Adelaide redevelopment.
“Until the casino makes a firm commitment I have not thought it wise for me to ‘count my chickens’,” he said in a statement to InDaily.
“Negotiations are continuing this week and I remain optimistic of a good outcome.”
He also revealed that whoever gets the nod to redevelop the area to the year of the current casino would be expected to make a financial contribution to the surrounding public spaces.
However, he would not comment more specifically on what financial arrangements the Government would seek with the casino or any other potential developer.
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“In these circumstances there is no point in exploring hypotheticals or contingencies other than to say that whoever ultimately takes up a lease over the land at the rear of the railway station will be expected to contribute to the public realm.”
SkyCity reported a good performance in its New Zealand operations last week, but said the Adelaide results were disappointing.
While it remained committed to the Adelaide redevelopment, it expressed doubts about a start date.
“SkyCity continues to review the concept design and development costs to ensure the expansion project best meets the future requirements of the South Australian market and is value-enhancing for shareholders,” SkyCity said in its results overview.
“However, timing to commence the expansion works is uncertain and needs to be coordinated with the South Australian Government’s and Walker Corporation’s plans for the broader development of the Riverbank precinct.”
In March, developer Walker Corporation reached a deal with the State Government for a $600 million redevelopment of the Festival Centra Plaza, including rebuilding the car park and the constructing of an office tower between Parliament House and the casino.
At the time of the announcement, the Government said the project would take about three years to complete, but there has been little news since.
A key part of the deal was an agreement to lease 750 car parks to the casino.
The concept development document released today shows some more detail about how the plaza and surrounding area will be levelled and landscaped.
It also shows – in stark terms – how the Walker Corporation office tower will overlook the public space.
