Wynn Resorts is positioning itself to be the only operator with a casino in the United Arab Emirates for several years, potentially giving it a monopoly in a market that could bring in billions for the Gulf nation.
CEO Craig Billings stated in an earnings call that the company expects to be the sole operator for a multiyear period, after which there may be a duopoly or oligopoly of three operators. The Wynn Al Marjan Island is set to open in 2027 in Ras Al Khaimah, an emirate with a population of around 450,000. The projected cost of the resort is upwards of $3.9 billion, surpassing the costs of iconic hotels such as Burj Al Arab and Atlantis The Palm in nearby Dubai.
The UAE recently announced the establishment of the General Commercial Gaming Regulatory Authority (GCGRA) to regulate the country’s gaming industry. Speculation about country-wide gaming arose following the formation of GCGRA, chaired by former MGM CEO Jim Murren.
MGM’s Bill Hornbuckle has expressed interest in obtaining a gaming license for a resort in Dubai, but Wynn Resorts sees a different future. Billings believes that not every emirate will host an integrated resort due to cultural nuances, population density, and varying degrees of need for additional visitation. In light of this, sources have indicated that the Dubai government has put casino plans on hold.
Following the formation of GCGRA, Caesars announced its exit from Dubai, while MGM is uncertain about the possibility of having a casino in Dubai. In contrast, Wynn Resorts is already anticipating the licensing process and expects to receive a provisional and final license soon.
The formation of GCGRA has alleviated uncertainty around gaming in the country, making it easier for Wynn Resorts to attract investment and secure construction financing relatively quickly.
The expected tax rate on gross gaming revenue in the UAE falls within the range of 10 to 12%. Wynn Resorts projects that the adjusted EBITDA for the Wynn Al Marjan Island could reach as high as $600 million annually, positioning the company for significant success in the region’s burgeoning gaming industry.