The Wrest Point Riviera Hotel, designed by architect Keith Wildman and built by Arthur Drysdale and opened on 5 December 1939, was originally constructed on the site of the current Wrest Point Casino. During World War II the hotel was "booming" and the hotel was sold to Australia's oldest hotel group, Federal Hotels, in March 1956.
In the 1960s, The Federal Group attempted to secure Australia's first casino license. At the time, Tasmania's natural scenery and beauty were not widely known elsewhere, and as a result the state wasn't attracting many tourists. The marketing claim was that a casino could be the draw-card that would kick-start Tasmania's tourism industry.
A state referendum was held to determine the granting of a gambling licence. The polls were very tight, especially since the question in the referendum attempted to minimise the gambling aspect of the development.
Shortly before the referendum was to be held, the Labor party, sensing they had the numbers in the parliament pushed through the legislation to legalise the casino. They did not wait for the results of the vote. When the vote was taken the hotel redevelopment was narrowly passed. Questions have since been raised about how the legislation was passed, with one member of parliament, Kevin Lyons, suspected of accepting bribes over the licence.