April 28, 2023
In a press release yesterday, Wynn Resorts announced its plans to develop the first ever casino resort in the United Arab Emirates, called Wynn Al Marjan Island, in Ras Al Khaimah. The USD3.9 billion development, which is slated for completion in 2027, will create a resort that includes 1,500 hotel rooms and suites, which will be housed within a 1,000-foot-high tower. It will also feature several ultra-premium villas with beachfront access. The resort will have non-gaming amenities including 120,000 square feet of retail space, as well as 24 restaurants and lounges.
Although the announcement came just yesterday, their work toward this project was made known in 2022. In an interview with the Nevada Independent in July of 2022, Wynn CEO Craig Billings summed the reason for the UAE move thusly:
There has been tremendous modernization and progression in the UAE. The Dubai airport sees more than 80 million passengers a year. There's an amazing amount of inbound visitation from Europe, the Middle East, India and other surrounding countries. We believe there will be a robust cash-based business like we have here. We see it as a real extension of our brand.
Further underlining the motivation for the decision came when Billings revealed that licenses to operate casinos in the UAE will be very limited, and that for a significant period of time, Wynn Al Marjan Island will be the only casino in the entire region. This will give Wynn an essential gaming monopoly within the region.
To progress into this growing aspect of tourism, the Islamic nation has had to move toward relaxing its laws which prohibit gaming. Although there is no indication that regulations will be introduced to allow for legal UAE betting sites within the online sports wagering realm, in a piece written in April of 2022, Reuters reported that UAE gambling laws were going to be relaxed in order to facilitate these kinds of casino resort projects. Although from a cultural perspective, gambling is contrary to the culture and religion of the region, the UAE knows that its neighbour, Saudi Arabia, is currently undergoing its own push toward social progression and commercial diversity. There are those within the Emirates that see this progression as an inevitability, so it is better to take the advantage that comes with being the "first mover".
From Wynn's perspective, this is the most important announcement since the failed SPAC for their digital arm, WynnBet. While there has been much speculation that Wynn was looking to sell its WynnBet operation, after its CEO had publicly decried the cost of player acquisition in the US online sports betting marketplace, they have clearly moved on to areas where they can actually leverage their brand to grow the business - in the development in actual casino resorts. Given the tailwinds surrounding Dubai, Abu Dhabi and now Ras Al Khaimah as tourist destinations, this UAE casino development seemingly promises to be an exciting proposition for the company, as industry analysts foresee free cash flow from the property in the region of USD450 to USD600 million per year, which compares favourably to Wynn's Las Vegas, Macau and Boston Harbour properties.