Blackstone Group Signals Confidence in Crown Melbourne Property

As a result, Blackstone will be investing in what it sees as a much-needed renovation in Crown Melbourne, following the $6.5-billion acquisition of Crown Resorts last year. This was carried out amid increased pressure on the property, as it faced probes into various offenses and breaches of Australia’s gambling laws.

Blackstone Outlines Future Success of Melbourne Property

However, Blackstone president Jon Gray said that he was confident in Crown’s prospects in a recent interview with The Australian, echoing a group-wide sentiment that despite its tarnished reputation, Crown Melbourne is a shiny jewel in global gaming and hospitality.

All it needs to get back to its once-favored status is a bit of a buff. According to Gray, Crown Melbourne is one of a kind, with its scale and significance undoubtedly capable of attracting crowds from the world over.

Despite regulatory headwinds, the property remains as important in Blackstone’s global gaming and hospitality strategy as ever. He added:

Melbourne is a physical turnaround story and our objective would be to invest significant capital there and enhance the asset, which we think will be great for the community and great for tourism there as well.

Blackstone president Jon Gray

Gray said that the regulatory heat Crown was facing was not really anything that worried it as of right now. Crown recently agreed to settle a $300 million (AU$450 million) fine imposed by AUSTRAC, Australia’s financial regulator. This too has not made Blackstone any less confident in the property’s prospects.

If anything, Gray has drawn parallels to The Cosmopolitan in Las Vegas, a property that the group acquired for $1.7 billion in 2014 only to sell years later for $5.7 billion. At the time, Blackstone went in with the same confidence, seeing the potential of the famed company despite its financial troubles.

Present Challenges Should Not Dissuade Investment Zeal

Gray said that it was a combination of factors that made The Cosmopolitan sale worked the way it did, because the company found the right managers to take care of The Cosmopolitan and break away from the same practices that drove the business into the ground in the first place. Investment was also needed to refurbish the venue and Blackstone was more than happy to cough up.

Ultimately, though, Gray said that there is nothing to suggest that Crown Melbourne and Crown, in general, would lessen its appeal. Australia’s tourism industry is one of the country’s main economic drivers with cities such as Perth, Sydney and Melbourne popular destinations that people want to visit.