Analysts see long-term value in Wynn’s UAE bet despite higher costs, delay

Wynn Resorts’ plan to delay the opening of its Wynn Al Marjan Island resort in the United Arab Emirates and raise its budget by about USD600 million has increased near-term funding requirements, but analysts say the project’s long-term returns remain attractive.

Wynn announced on Wednesday that it expects the Ras Al Khaimah resort to open in September 2027, about six months later than initially planned. In addition, the total project budget has risen from about $5.1 billion to approximately $5.7 billion, with Wynn responsible for 40% of the development alongside local partners Marjan LLC and RAK Hospitality Holding LLC.

During the second-quarter 2026 earnings call, Wynn’s chief financial officer Craig Fullalove said the company’s share of the latest increase would require about $240 million in additional equity.

So far, the company has contributed about $1.06 billion to the development, while its remaining equity contribution for the broader project, including the adjacent Janu Al Marjan Island development, is expected to range from $525 million to $650 million.

In a note earlier this week, JPMorgan analysts projected that Wynn will allocate between $300 million and $350 million to the project in 2027 – more than triple its earlier forecast of $75 million to $100 million.

JPMorgan also noted that the higher spending reflects the additional equity required after the budget increase. “While early, we think Wynn’s 2027 setup is starting to look compelling: UAE is back to being a positive catalyst,” JPMorgan analysts said.

JPMorgan said about half of the cost increase was directly linked to the regional conflict, including higher procurement, material and shipping costs, as well as additional preopening and capitalized interest expenses caused by the longer construction timeline. The remainder reflected remeasurement, trade coordination and other costs associated with a project of the resort’s scale.

“While Wynn can’t dictate the geopolitical landscape in the region, we do think the UAE update should be viewed positively as investors have struggled to handicap the property’s timing/prospects,” analysts Daniel Politzer, Samuel Nielsen and Michael Hirsh wrote.

Meanwhile, commercial real estate services and investment firm CBRE offered a more bullish assessment of the project’s long-term prospects. CBRE expects Wynn to receive about $355 million in annual free cash flow from Wynn Al Marjan Island through management fees and dividends once the resort reaches stabilization in 2031.

According to CBRE, the forecast would represent a 22% unlevered annual return on Wynn’s equity investment. Based on the company’s existing contribution and the remaining funding requirement, Wynn’s total equity investment could reach between $1.59 billion and $1.71 billion.

CBRE described Wynn Al Marjan Island as the “only meaningful integrated resort casino supply” in a large and well-populated surrounding market, while describing the six-month delay and roughly 11% budget increase for the project as “relatively minimal” given the disruption in the region.

Citing tourism figures from Ras Al Khaimah, CBRE said the emirate recorded a record number of tourist arrivals in the first half of 2026, alongside a 47% year-over-year increase in domestic arrivals, pointing to the depth and resilience of the local market despite geopolitical uncertainty.

However, the brokerage cautioned that the opening timetable could still change because of continued volatility in the Middle East.

On planned investment in Macau, including the new Enclave hotel tower and an event and entertainment center at Wynn Palace, JPMorgan said it expects Wynn’s capital spending in 2027 to rise to between $750 million and $800 million.

The bank also highlighted that daily operating expenses in Macau, excluding gaming tax, rose 9% year over year to $2.9 million in the second quarter, reflecting higher volumes, wage adjustments and investment in the expansion of the Chairman’s Club at Wynn Palace.