STRAIGHT TALK: WHY FUNG IS BUYING INTO THE GOLD COAST MARKET

Written on the 3 July 2015 by Jenna Rathbone

STRAIGHT TALK: WHY FUNG IS BUYING INTO THE GOLD COAST MARKET

IN a short period Aquis has built a big name for itself on the Gold Coast, snapping up properties across the city and launching bold plans for major developments.

This includes an integrated resort and casino at the Sheraton Mirage Resort, which has caused debate among business leaders including opposition from Echo Entertainment - the company that runs the city's sole casino.

But the Chinese billionaire-backed empire believes competition is great for consumers and Jupiter's has probably abused its monopoly position by under-investing in their facility.

"Over the last decade it has become a tired attraction that has done little to attract the new breed of international visitor," says CEO Justin Fung, who has a background in law.

"It has been a huge missed opportunity for the Gold Coast. Only now with the threat of competition looming have they bothered to make an investment to improve their offering."

Aquis also recently announced its partnership with the Gold Coast Titans, signaling it is here for the long haul, and has plans for projects in Surfers Paradise, Varsity Lakes and the Gold Coast Hinterland.

Justin Fung talks to Gold Coast Business News about Aquis' penetration of the Gold Coast market, including what attracted the Hong Kong-based family to the city.

What are three key leadership strengths you bring to your current role and how do they assist in the successful running of the business?

Being consultative and relying on local experts has been one of the most important aspects of our entry into the Australian market. We are foreigners coming to a new market and, while we have a great understanding of the opportunity and the big picture, we need good advisers to guide us through the detail.

Having a strong legal background is fundamental to most processes these days regardless of jurisdiction. Patience is also important. We want to do a lot of things in a lot of different spaces so picking our priorities and not doing everything at once is important.

Aquis is building a big name for itself on the Gold Coast. What makes the city an attractive place to do business?

The Gold Coast has always been a tourism town. It is built on tourism and will be one of the biggest beneficiaries of the growth of the Chinese market. The fact it has always been a tourist destination means it has a strong, mature hospitality industry that provides a solid foundation for future growth.

What are some of the challenges the Gold Coast faces and how do you think the city can overcome these?

Like most growing cities, infrastructure is the greatest challenge. Moving people around on the Gold Coast will become increasingly difficult as the population grows and tourist numbers grow. Light rail has been an important and valuable addition, but I think it needs to become more of an integrated network. The community is well aware of the financial challenges governments face in funding more infrastructure and I think more creative partnerships with the private sector, with companies like Aquis, will be the long-term solution.

You have recently signed as a sponsor of the Gold Coast Titans. What was the reasoning behind this partnership?

We wanted to send a strong message to the community that Aquis is here to stay. Football clubs are the heart and soul of most communities, so we couldn't think of a better place to start than the Titans. They are also going through a bit of rejuvenation and we wanted to get on at the ground floor.

You have plans for an integrated resort and casino at the Sheraton Mirage Resort site.  What are the benefits of the project to the city?

We haven't finalised our plans yet and still have some hurdles to overcome, but we think the Gold Coast really needs an iconic development. Something that is instantly recognisable to a global audience and has the ability to draw people from around the world. We already have the incredible natural beauty of our beaches and hinterland. We think it is time for a man-made attraction that reminds the world how great the Gold Coast is.

Echo Entertainment has dismissed the idea of a second casino on the Gold Coast. Do you believe there is room for another casino and how will it impact the city?

Monopolists will always argue for the status quo. The bottom line is competition is great for consumers. With no competition, monopolists have no incentive to invest and improve their product. In the increasingly competitive international market new investment and maintaining high standards is essential to attracting new and repeat visitors.

Jupiter's has probably abused its monopoly position by under-investing in their facility. Over the last decade it has become a tired attraction that has done little to attract the new breed of international visitor. It has been a huge missed opportunity for the Gold Coast. Only now with the threat of competition looming have they bothered to make an investment to improve their offering.

Fung Gold Coast assets include:

  • Sheraton Mirage Resort ($160 million); redevelopment including new casino planned
  • International Beach Resort ($55 million); high rise redevelopment plans in train
  • Robina commercial site ($45 million); plans include a student accommodation project
  • Patinack Farm ($20.5 million); plans include a new 'mega' tourism development
  • Soul Penthouse ($7 million); bought at a huge discount to $16.85 million originally contracted by Charlie Caltabiano in 2006

Author: Jenna Rathbone
About: Jenna Rathbone is a Queensland-based journalist who writes on a range of issues including business and property affairs and social issues.
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