Posted on: February 10, 2024, 07:58h.
Last updated on: February 10, 2024, 07:59h.
Wynn Resorts (NASDAQ: WYNN) is said to be close to beginning work on the hotel tower for Wynn Al Marjan Island in the United Arab Emirates (UAE).
The project is estimated at $4 billion and is expected to be the first gaming venue in the UAE, with an opening date set for early 2027. Wynn’s minority interest in the venture reduces its financial exposure. The property on Al-Marjan Island is developed with local partners Marjan LLC and RAK Hospitality Holding LLC.
Its project in the UAE continues its construction with much of the hotel tower and podium foundation now complete, and will soon start going vertical on the hotel tower,”
The property is expected to encompass 5.6 million square feet, with a casino anticipated to account for 4% of that space.
Wynn Bullish on UAE
Wynn delivered impressive fourth-quarter results this week, with CEO Craig Billings expressing bullish sentiment on the UAE property.
“And importantly, we have a substantial growth opportunity in the UAE that will further diversify our portfolio and expand our brand into new markets,” he said.
Wynn Al Marjan Island is expected to feature gaming as more of a minor amenity and less of a focal point, but that could be to the liking of UAE regulators looking for avenues to potentially bring casino gaming to a region that’s long opposed it.
The property “is really going to be a stunner, and it’s great to see the buildings start to take shape,” added Billings.
Gaming Regs Pivotal to Wynn UAE Fortunes
Wynn Al Marjan is widely expected to feature a casino, however, last September, the UAE announced the formation of the General Commercial Gaming Regulatory Authority (GCGRA) — the Emirates’ first gaming regulator.
Led by former MGM Resorts International (NYSE: MGM) CEO Jim Murren, the GCGRA is tasked with developing gaming rules and regulations for the UAE. However, the group has not released related guidelines.
That lack of clarity on the ability of Wynn to operate a casino in UAE is a potential headwind. While shares of the company are higher by almost 16% year-to-date, some analysts have argued that the UAE project isn’t priced into the stock, indicating market participants don’t fully appreciate Wynn’s UAE opportunity set or are concerned about its casino approval prospects.