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China – Wynn to spend $2bn on non-gaming Pavilion at Wynn Palace

By - 12 July 2019

Wynn Macau has published plans for $2bn expansion at its Wynn Palace casino on the Cotai peninsula in Macau.

Building work will begin on the Crystal Pavilion complex in 2021, with an opening set for 2024. It will be built adjacent to the Wynn Palace, would include a theater and museum, two hotel towers, each with 650 rooms, interactive sculptures, gardens, a 270-degree fully-immersive, entertainment theatre and a destination food hall that offers a wide variety of regional Asian cuisines. Wynn believes it will attract 7m to 10m people each year to the Crystal Pavilion. The immersive theatre will use super-live technology, while the art museum will overlook the new gardens.

CEO Matt Maddox said back in November: “We have a seven-acre parcel next to Wynn Palace Cotai and we’ve been working very hard on what could come next and what we have so far is a 1.5 million sq ft facility that we think will be a must-see in Macau. In addition, on the north four-acre parcel we were working on a 700-room all-suite hotel that we’ll connect into the north side of Wynn Palace Cotai.”

Analysts with JP Morgan DS Kim, Jeremy An and Christine Wage said: “Target return on investment is 15 to 20 per cent, implying incremental EBITDA of US $300m to US $400m from phase one. This would mean 35 to 47 per cent boost which seems a bit aggressive for primarily non-gaming expansion.”

David Katz, an analyst with Jefferies Financial Group said: “The long-term financial targets released at the 2019 investor day are slightly more conservative than expectations, although the capital allocation commentary should be received positively.”

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