Brisbane’s proposed luxury shopping precinct in doubt, while a court dispute is underway

The luxury shopping precinct at Brisbane’s Queen’s Wharf is in limbo because the project developer is locked in a court battle over the condition of the heritage retail space.

The Destination Brisbane Consortium (DBC) is being sued by its tenant DFS Australia over the state of the old Queensland Government Printing Office, a heritage building adjacent to the Queen’s Wharf development and intended as a luxury shopping precinct to include retail offerings from Louis Vuitton, Cartier, Gucci and Dior.

The retail fail comes amid growing concerns about the financial viability of the consortium’s main partner, Star Entertainment Group, which is in an ASX trading halt after it failed to release its financial position to the market last month.

Directly below The Star Brisbane casino — the centrepiece of the project — nearly all of the Queen’s Wharf food and retail space remains a work in progress along the terrace that opened to the public two weeks ago.

But access to the old printery building next door is blocked and all work on that site is halted.

DFS is suing Destination Brisbane Consortium for more than $15 million spent on fitting out the building.

DFS terminated its lease last December, accusing the consortium of misleading conduct and alleging the printery was unsuitable for occupation because of ongoing problems with peeling lead paint and mould.

Court papers obtained by the ABC also reveal DFS is seeking $9 million in bank guarantees linked to the lease, which the consortium has called in, alleging a breach of the lease.

The consortium launched a counter claim against DFS, arguing it failed in its promise to secure luxury brand tenants for the space.

DFS said it was obliged to start the fit-out amid risk of lease termination and only did so after allegedly being advised by the consortium that concerns with lead paint and mould had been dealt with.

No court date has been set for the matter, leaving the old printery’s retail prospects in limbo indefinitely.

It is the latest in a shopping list of concerns and delays to beset the massive development in Brisbane’s CBD from the day after it opened its doors to the public.

It opened more than a year late and several months after DBC settled a separate legal dispute with project builder, Multiplex.

The $3.8 billion cost of Queen’s Wharf is nearly double the initial estimate, but its value is estimated to be about half of that cost.

The ABC understands Star Entertainment’s new chief executive Steve McCann is seeking to write down the value of Queen’s Wharf by $1.4 billion, effectively leaving the development worthless.

The share price of Star Entertainment has fallen from 84 cents a year ago to 45 cents on August 30 — the day it began a trading halt.

Cash strapped 

In the past year, the company has twice sought funds from shareholders and has tapped its biggest investors for extra cash.

It faces an as-yet-undisclosed fine by federal financial regulator AUSTRAC that could stretch into the hundreds of millions.

Premier Steven Miles has confirmed Star Entertainment is seeking tax relief from the Queensland government.

One positive note for Star came earlier this month with the sale of its leasehold interest in The Treasury building (the site of the former Star casino) to Griffith University for $67.5 million.

There is no word yet on any sale of the adjacent Treasury Hotel.

Queensland’s gambling regulator granted DBC a licence to operate The Star Brisbane casino two days before Star Entertainment Group was again ruled unsuitable to run a casino in NSW.

Star has until December to prove its suitability as a casino licensee following major failings in controlling money laundering at its Brisbane and Gold Coast casinos, first revealed in 2022.