Island 3 AMI FZ-LLC<\/strong>, the joint venture vehicle. CBRE expects most investors to include Wynn\u2019s share of the resort\u2019s earnings in its EBITDA and cash flow calculations without adding the project-level borrowing to the parent company\u2019s consolidated leverage.<\/p>\n\n\n\nThe analysts consider this treatment reasonable given the project\u2019s financing arrangements and majority government ownership. However, they acknowledged that investors could take a more conservative approach by accounting for Wynn\u2019s proportional share of both the debt and earnings.<\/p>\n\n\n\n
Even under that scenario, CBRE estimates that Wynn would achieve approximately 0.6x of deleveraging after the resort opens. The analysts therefore expect the development to improve the company\u2019s credit position regardless of how investors account for its debt.<\/p>\n\n\n\n
Wynn\u2019s latest regulatory filing provides further details of the financing. The company confirmed that it is not a direct party to the US$2.4bn loan agreement but, alongside the Ras Al Khaimah government, has provided a completion guarantee to lenders. The guarantee will expire once the resort reaches practical completion or the secured liabilities have been repaid.<\/p>\n\n\n\n
CBRE said the expected reduction in leverage could also put Wynn in a position to secure credit rating upgrades from Moody\u2019s<\/strong>, S&P Global Ratings<\/strong> and Fitch Ratings<\/strong>. The agencies\u2019 current upgrade thresholds are:<\/p>\n\n\n\n\n- Moody\u2019s:<\/strong> 6.0x leverage, subject to Wynn generating strong positive free cash flow.<\/li>\n\n\n\n
- S&P Global Ratings:<\/strong> 5.0x leverage. Current rating: BB- (below investment grade).<\/li>\n\n\n\n
- Fitch Ratings:<\/strong> 5.0x leverage. Current rating: BB- (below investment grade).<\/li>\n<\/ul>\n\n\n\n
The analysts described Wynn as a potential upgrade candidate at Moody\u2019s following the resort\u2019s opening. They also expect the company to enter an extended period of lower leverage and stronger free cash flow, without significant development capital expenditure on the horizon. The potential improvement in Wynn\u2019s credit standing could reduce its borrowing costs and give the operator greater financial flexibility to pursue future developments.<\/p>\n\n\n\n
Frequently asked questions (FAQs)<\/h2>\n\n\n\n\n- When will Wynn Al Marjan Island open?<\/strong> The resort is scheduled to open in September 2027.<\/li>\n\n\n\n
- How much is Wynn Al Marjan Island worth?<\/strong> It is a US$5.7bn integrated resort in Ras Al Khaimah, in which Wynn Resorts holds a 40 per cent interest alongside Marjan and RAK Hospitality Holding.<\/li>\n\n\n\n
- How could the resort affect Wynn Resorts\u2019 leverage?<\/strong> CBRE forecasts Wynn\u2019s lease-adjusted leverage could fall to approximately 5.0x in 2027, more than 1.0x below its 2026 estimate.<\/li>\n\n\n\n
- What credit ratings does Wynn Resorts currently hold?<\/strong> S&P Global Ratings and Fitch Ratings currently assign Wynn a below-investment-grade rating of BB-.<\/li>\n<\/ul>\n\n\n\n
<\/p>\n","protected":false},"excerpt":{"rendered":"
CBRE forecasts Wynn\u2019s lease-adjusted leverage could fall to about 5.0x in 2027, potentially opening the door to credit rating upgrades.<\/p>\n","protected":false},"author":2395,"featured_media":810,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"is_press_release":false,"is_interview":false,"is_opinion":false,"focusai_summary":"CBRE Credit Research forecasts Wynn Resorts' lease-adjusted leverage could fall to approximately 5.0x by 2027, post the opening of the US$5.7bn Wynn Al Marjan Island integrated resort. This projected deleveraging, driven by the project's financing structure and cash flow contribution, positions Wynn for potential credit rating upgrades from agencies like Moody's, S&P Global Ratings, and Fitch Ratings. Such an improvement would enhance financial flexibility and reduce borrowing costs for the operator.","focusai_entities":"Wynn Resorts, CBRE Credit Research, Colin Mansfield, Connor Parks, Marjan, RAK Hospitality Holding, Island 3 AMI FZ-LLC, Moody\u2019s, S&P Global Ratings, Fitch Ratings","focusai_location":"UAE, Ras Al Khaimah","focusai_target_profile":"ceo_executive (1.0), compliance_legal (0.7), operator_casino (1.0), investor_analyst (1.0), supplier_vendor (0.7), journalist_researcher (1.0)","focusai_suggestions":[{"label":"Leverage Impact Analysis","query":"How might the projected credit rating upgrades influence Wynn Resorts' cost of capital and its strategic capital allocation decisions for future integrated resort developments?"},{"label":"Financing Structure Risks","query":"What are the specific implications and potential risks for Wynn Resorts' consolidated balance sheet if investors adopt a more conservative accounting approach for the Al Marjan Island project's proportional debt?"}],"footnotes":""},"categories":[155,9,151],"tags":[12,124,52],"class_list":["post-1496","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured-article","category-finance-news","category-ras-al-jaima","tag-casinos","tag-integrated-resorts","tag-wynn-resorts"],"_links":{"self":[{"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/posts\/1496","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/users\/2395"}],"replies":[{"embeddable":true,"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/comments?post=1496"}],"version-history":[{"count":10,"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/posts\/1496\/revisions"}],"predecessor-version":[{"id":1518,"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/posts\/1496\/revisions\/1518"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/media\/810"}],"wp:attachment":[{"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/media?parent=1496"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/categories?post=1496"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/focusgn.com\/uae\/wp-json\/wp\/v2\/tags?post=1496"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}