Wynn Resorts Ready to Spend $5 Billion on UAE Casino
Wynn Resorts has disclosed its plans to invest approximately $5.1 billion in the development of an integrated resort on Al Marjan Island, located in Ras Al Khaimah, United Arab Emirates (UAE). The company revealed the figures during an investor presentation held on the same day as the Global Gaming Expo (G2E) kicked off in Las Vegas.
The Wynn Resorts logo on its casino in Las Vegas. (Source: iStock Photo)
LISTEN TO THIS ARTICLE:According to the presentation, the budget includes costs for land acquisition, fees, and capitalized interest, with around $4.55 billion allocated for direct development expenses. Wynn Resorts' equity contribution toward the project is expected to reach $1.1 billion, of which $200 million has already been invested, and the remaining $900 million will follow.
Related: Wynn Resorts Starts Construction on First Casino in the UAEA significant portion of the funding for the Wynn Al Marjan Island resort is expected to come from debt. The company has already secured around $2.4 billion through debt financing, which is oversubscribed due to strong interest from both local and international investors. Wynn noted the high demand for participation in the project, signaling strong confidence in the resort's potential from the investment community. With financing in place and construction progressing, Wynn's development in Ras Al Khaimah is poised to be a major milestone for the company's expansion in the Middle East.
Wynn Al Marjan Island is projected to generate significant revenue and profit once operational. The company has forecasted annual gross gaming revenue (GGR) of up to $1.67 billion, driven by the resort's appeal to high-net-worth individuals, particularly from surrounding regions.
Wynn expects to see operating revenues ranging from $1.38 billion to $1.88 billion per year, with an Adjusted EBITDA of between $500 million and $800 million. The company is also projecting that its EBITDA margins could reach as high as 43%, indicating robust profitability from the high-end offerings at the resort.
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The revenue projections for Wynn Al Marjan Island are based on estimates of the UAE gaming market's size, which is valued at between $3 billion and $5 billion in GGR. Wynn expects its primary competition to come from two other integrated resorts planned for the region. However, Wynn believes it holds a competitive advantage due to its ability to attract wealthy consumers from Dubai and other parts of the UAE. The company highlighted that the market, particularly Dubai, includes a large, affluent, and underserved segment of customers with a strong inclination to spend on premium food, beverage, and luxury hotel experiences.
Wynn's brand and reputation for five-star service are central to its strategy for attracting ultra-high-net-worth international customers, often referred to as VVIPs. The company is targeting a global clientele, as well as the nine million expatriates residing in the UAE, to capture untapped demand for high-end gaming. The resort's location and offerings are expected to make it a magnet for both local and international tourists seeking luxurious entertainment experiences.
The development of Wynn Al Marjan Island has already sparked a construction boom in Ras Al Khaimah, particularly in the hospitality sector. According to CBRE analyst John DeCree, the number of hotel rooms in the emirate is expected to double by 2027, the same year Wynn's resort is slated to open.
The number of hotel rooms is anticipated to reach approximately 15,000, underscoring the rapid growth in infrastructure spurred by Wynn's investment. This expansion is further supported by the fact that Wynn was recently granted a gaming license for the integrated resort.
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