The global head of real estate for US private equity giant The Blackstone Group says it has already spent “hundreds of millions of dollars” on revamping Australia’s Crown Resorts and will spend much more in the years ahead.
In an interview with The Australian, Kathleen McCarthy said Blackstone has plans for Crown well beyond the AU$8.9 billion (US$6.5 billion) it spent to acquire the company in June 2022, including significant investment to meet tightened regulatory requirements as well as upgrading physical facilities.
“We have invested hundreds of millions of dollars [behind the scenes], now we get to the really exciting part, which is transforming the customer experience and what they are seeing,” McCarthy said, making specific reference to Crown’s original Melbourne resort.
“We remain very excited, and we are just really beginning the journey here.
“Melbourne is an incredible piece of real estate, an incredible property, and a great location, but it also needs capital investment to make it an exciting and fresh place for folks to come.
“We want to be attracting guests from all over the world and also from within Australia, whether it is the eating experience or the shows or the shopping experience.
“We see an opportunity to physically open up the property to make it feel a little different.”
McCarthy wouldn’t be drawn into questions by The Australian around any potential buyout of Crown’s local rival, Star Entertainment Group, which has also drawn the ire of regulators while seeing its share price plummet to just AU$0.60 from around $4.50 just two years ago.
However, she conceded the company is always looking for attractive investment opportunities.
“We’re really focused on the work ahead of us at Crown and the opportunity to transform the business,” she explained.
“But what has made Blackstone so successful is focusing on high-quality real estate where we have an opportunity to make operational interventions to transform the guest experience and the cashflow profile of the assets.
“Broadly, in the market, particularly in a dislocated environment, we see a lot of opportunities ahead to be investing in the themes we like.”
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