Casino developer and operator Wynn Macau, a unit of billionaire Steve Wynn's Las Vegas company, says it has received the green light on land for a casino in the Cotai district of Macau. It will be Wynn's second resort in the world's largest and most lucrative gaming hub.
The Macau government has approved Wynn Macau's Cotai land concession contract, paving the way to break ground on a 20.6 hectare site, the company said yesterday.
'The official transfer of real estate in Cotai makes possible the commencement of the construction phase of what will be the single most important project in the history of Wynn Resorts,' said Steve Wynn, chairman and chief executive of Wynn Resorts. Trading in Wynn Macau shares was suspended in Hong Kong yesterday. They have risen 28 per cent this year in Hong Kong, outpacing the benchmark Hang Seng Index's 14 per cent increase.
Cotai is the new gaming mecca in Macau. It hosts popular mega casinos, including the Venetian and Galaxy, and luxury hotels such as the Four Seasons and Conrad.
Sands China opened the first phase of its new project, Sands Cotai Central, last month, and Galaxy Entertainment Group said last week it would invest HK$16 billion in the second phase of its Galaxy Macau resort, due to open in mid-2015.
Francis Lui Yiu Tung, deputy chairman of Galaxy Entertainment, said then that the company had not talked formally with the government about the number of gaming tables but he was confident the government would be supportive if there were appropriate products.
Teng Yee Tan, an analyst at CIMB Securities in Hong Kong, said: 'Wynn sets a high standard for its properties and asks for the best quality.'
He said it took a longer time to build a Wynn resort. 'I think the project will open in 2016,' Tan said.
In the long term it would be positive for Wynn Macau, he said, because the gaming action was shifting from the Macau peninsula to Cotai.
'The project is likely to be completed in three years' time and won't ease the problems Wynn is facing now,' Tan said. Problems include the firm's lack of presence in Cotai and the fact that its facilities - hotel rooms and VIP gaming tables - on the peninsula were at capacity in the peak season.
Tan estimated the new project would cost HK$20 billion.
MGM China Holdings and gaming tycoon Stanley Ho Hung-sun's SJM Holdings have no properties on Cotai but they are applying for land concessions there. The chance of approval this year was slim, he said.
Wynn Macau accepted the terms of a draft land concession in September and paid an initial deposit of 500 million patacas in December. SJM and MGM have not yet received draft concession contracts.