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The Star's contribution is a $40 million equity investment in the beachfront five-star resort on The Spit, which reportedly sold for $140 million.
The purchase strengthens The Star's presence on the Gold Coast as the ASF Consortium attempts to garner support for its $3 billion integrated resort and casino plans for a block adjacent to Seaworld, just a few hundred metres from the Sheraton Mirage.
The Star is also investing up to $850 million in Jupiters Casino in Broadbeach, where it has plans for five towers in addition to the casino.
It has also begun work on its $3 billion Queen's Wharf Development in Brisbane.
Both of those developments are being done in partnership with Chow Tai Fook Enterprises and the Far East Consortium.
The Sheraton Grand Mirage is the Gold Coast's only five-star beachfront resort and The Star sees it as offering a new dimension to its Gold Coast, Brisbane and Sydney casino and resort offerings.
"It is a highly valuable asset as it is and we will look to further enhance its appeal over time, always respecting the unique natural environment of The Spit and preserving the character of this special area," says Matt Bekier, managing director and chief executive officer of The Star Entertainment Group.
"The opportunity to offer our guests diverse and world-class experiences, and enjoy a mix of urban and beachfront luxury, is enhanced by this acquisition.
"The Star Entertainment Group views the tourism sector as a significant long-term economic driver or Queensland and Australia, and the purchase of the Sheraton Grand Mirage reflects that confidence."
Marriott International will continue to operate the resort under its long-term management agreement.
The Star will look to enhance the resort's food and beverage offering, but has no plans for gaming facilities or high rise development on the site.
Development on The Spit is a contentious issue as it a three-storey height limit, but both ASF Consortium and Sunland Group have proposed high rises in the area.
The former owner of the Sheraton Mirage, MiiResorts, bought the property for $62 milllion in 2008.
In trading on the ASX this morning, The Star Entertainment Group is trading down 1.53 per cent on the previous day's close at $4.815 per share at 11.20am AEDT.
Business News Australia
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