Two Way Hard Three | Las Vegas Casino & Design Blog

February 27, 2007

Wynn Resorts: 4th Quarter 2006 Loss

Posted by Hunter

Wynn Resorts announced their numbers today for Q4 2006 (and FY2006).

Despite opening Wynn Macau, the supposed cash generator for the company, they had a loss for the quarter of $55 million.

What does this mean for the company if they can't make a profit with Macau open? How serious is this and what will the company do to stop the bleeding? It is important to note that a large portion of the loss was related to debenture holders.

Despite operating at a loss, some of the numbers look good, including holds and net revenues.

The extensive press release is here:

Also interesting is the occupancy rate for Wynn Macau, which was just north of 80%. I watch the occupancy rates as a very interesting indicator of how the Macau market is rising to the challenge of conversion to a 'resort destination' city away from a day trip market.

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Read archived comments (55 so far)
February 27, 2007 1:51 PM Posted by mike_ch

It's good to see that the leader took responsibility for this loss and punished himself ahead of time with a pay raise.

February 27, 2007 1:59 PM Posted by Brian Fey

Oh no! I can't wait to hear what Leonard has to say now! :)

February 27, 2007 2:02 PM Posted by askld

You have to first listen the whole call before posting such stupid blogs.
They clearly mentioned the reason for the loss. and what the profits would have been if it was not for that. Everybody expected 47 cents and they came up with a 53 cents if it was not for that debentures. That shows Macau is blowing and giving them blow out numbers.
Hear things completely and then make sickening posts as you like.

February 27, 2007 2:04 PM Posted by Pikes

WOW, Time to remodel the theater and build some new villas.

February 27, 2007 2:07 PM Posted by Hunter

I am currently listening to the call, which is still in progress.

I posted the above questions to foster a discussion, which I think is deserved - there's no doubt that many Wynn believers expected the company to post a profit for Q42006 and they failed to do so.

While I did publish your comment, I will not do so in the future unless you have something substantive to add to the discussion.

I suggest you review this site's track record and previous postings in relation to Wynn Resorts before you post ill-informed commentary.

Thanks for reading.

February 27, 2007 3:38 PM Posted by Leonard Stern

Damn it Brian, I wanted to make sure that I got my "dig" posted here first but you beat me to the punch + took all of the wind out of my sails. :-)I just got the news on my BlackBerry. Don't say that I didn't warn all of you beforehand, the 2006 Q4 loss is substantial enough + indeed is quite disturbing news for WYNN's viability (stock share value-wise) long-term. One quarter short of two years in operation + still reporting continued quarterly losses (which have actually widened from Q4 2005) speaks volumes that Steve continues to make it evident that he simply is both incapable + incompetent of running a successful mega-gaming operation, period! Even though analysts predicted an EPS of 0.47 + WYNN actually came in with a better than expected EPS of 0.53, nonetheless, the company is relying on profits derived primarily from revenues generated through their Macau operation which will soon be facing very stiff competition from the soon to be launced Venetian Macau + their neighboring direct competitor, MGM Grand Macau when it is completed shortly. MGM Grand Macau is expected to be a superior property to Wynn Macau in all respects based on MGM's decision to increase the construction budget to $1.1B+, but there is no doubt that these two properties will seriously cut into Wynn Macau's bottom line. I forgot who it was recently here (I hope it wasn't you Brian) that responded to my comments in connection with the fact that WYNN was overvalued + overweight, but I believe the post went something like this: "I should have dumped that junk when it was at 90!" Well guess what, that probably would have been a really good business move since WYNN was down today, once again, almost 4.5 pts. to close @ 95.90, despite the market freefall. All I can say is, Steve, you better start looking for a new job soon, I hear Adelson is looking for a fine art curator for all of his LVS properties, OH, wait a minute I forgot, perhaps you probably don't have the proper qualifications for that particular position considering your "previous job experience". Hear that "POP", it was the sound of my opening an ice-cold bottle of Cristal to celebrate today's events. LOL

February 27, 2007 4:11 PM Posted by mike_ch

Leonard, you don't see MGM helping Wynn Macau at all?

I know eventually Cotai will either prove itself out or not and if it does everyone will jump onto their Cotai projects, but so long as only Venetian is open it seems to me that Wynn's + MGM's + Ho's > Venetian.

Unless you can somehow prove to me that customers are so loyal to LVS that they would pass those three to be stuck on an island with The Venetian?

February 27, 2007 4:25 PM Posted by David F.

Disappointing results no doubt, but I also note that LVS dropped more than 4.5 points today (over 5%) and MGM Dropped almost 5.5% (3.93 points), but why let the facts get in the way of sneering.....

February 27, 2007 4:26 PM Posted by Devon

While you continue to badger wynn's share price, it is down slightly less than MGM (-5.41%), or LVS (-5.16%).

On an other note...did anyone else hear wynn's little speech about neighboring competitors? He's excited about palazzo and venetian macau, unlike opinions here stating that V. Macau and MGM will ruin Wynn Macau.

BTW, Steve seems to be a little nice to sheldy in the call. Other than the fact that he slips in that Palazzo is 22-23 months out-LVS is planning an October opening.

"We will build a better mousetrap. That's what we do"-Steve Wynn at the 4Q confrence call

February 27, 2007 5:42 PM Posted by Adam F

Just wondering� since, most of the comments are pretty consecutive, why not go into the chat room? Just wondering. Maybe we should schedule a chat again :-)

February 27, 2007 6:09 PM Posted by Chris

Leonard, when you say "Steve continues to make it evident that he simply is both incapable + incompetent of running a successful mega-gaming operation, period!" I feel like you may be forgetting a couple places called The Mirage and Bellagio. The definition of a successful operation is not defined by how any of us think it 'should' be run, it's defined by the public's general opinion of it and its bottom line financials.

On another note I think we all may be giving Steve a little too much personal attention just because the company is named after him. As Chairman and CEO, ultimate responsibility lies with him, but do Marc Shorr, Ron Kramer, John Strzemp, etc. really just sit in a row in front of his desk all day saying "Great idea, boss!"? Let's spread the blame, and the credit, around a little. Steve may be more hands-on than a lot CEOs but this is a big company and it's naive to think he is somehow personally handling every aspect of day-to-day operations.

February 27, 2007 6:34 PM Posted by Brian Fey

Devon - No, Wynn said Encore was 22-23 months out, not Palazzo. Listen to the call again.

Leonard, I must admit, I am currently speechless. The share price does mean nothing today though, as everything has been getting hammered.

February 27, 2007 7:27 PM Posted by Devon

oh...that makes a little more sense.

I was trying to multitask and I guess it didn't really work out.

February 27, 2007 9:20 PM Posted by Leonard Stern

OK, to ALL of you guys, you must admit that I have been "batting a thousand" thus far in all of my earlier predictions with respect to WYNN, no? Chris, first of all do you really believe that Steve is capable of actually delegating operations to ANY of his highest ranking executives, i.e. Shorr, Kramer, Strzemp, et al? These guys are the male equivalent to "The Stepford Wives" when it comes down to who really runs the company + everyone in the gaming industry knows that the final decisions go all the way to the very top, that being Steve himself. Don't even attempt to try and place the blame and the continuing decline of Wynn Resorts performance onto his "yes men" subordinates who do exactly as they are told. Brian, you are absolutely wrong regarding today's share price decline for WYNN having been related to the market's drastic decline today. Institutional investors have been abandoning this security [Wynn] for close to a month now, the recent sell off is a direct result of individual investors' lack of confidence in WYYN's 2006 Q4 earnings. However, because of the fact that the EPS exceeded the analysts' predictions, the share price actually has a chance of advancing in the next few days. I listened to the call as well + it is obviously apparent that Steve has some "reservations" regarding the stupidity of [his] having earlier challenged + subsequently filed multiple lawsuits against his neighbor/competitor [Adelson] who will eventually overtake Steve's entire operation in both Las Vegas + Macau to the extent that Wynn will never be able to recover. 100% guaranteed! Steve Wynn is no longer "King of the Strip", actually he never was. Chris, I think you need to review the actual facts before making the suppposed "informed" comment you posted, BOTH Mirage + Bellagio were in the RED before Kerkorian raided Mirage Resorts in 2000 for a song! And Steve actually had the nerve to try + spin or otherwise suggest that he "made a deal" with Kerkorian in advance personally to absorb Mirage Resorts, Inc. based on his own terms before the acquisition was made public. GMAB! If you guys cannot figure out by now that Steve will ALWAYS place a spin on his competitors entry into the market in a big way, you are all smoking crack! Watch when Wynn will welcome CityCenter as a positive influence for his own properties, when in fact, CityCenter will reduce WLV+Encore to the level of a Motel 6! Because of MGM Grand Macau's proximity to Wynn Macau they will experience some "spillover" effect. Ultimately it will be the Cotai Strip that will generate the lion's share of business in the long run in Macau + Adelson controls this venue entirely, despite Wynn Resorts' 54 or so acres that they will not be able to afford to develop for a long time. Devon, really do you actually believe that Steve is truly "excited" about competing properties that are highly profitable while his company continues to suffer declining revenue, please, do you believe this "Wynnism"? BTW - Rumors abound regarding the recently released/published confidential Pansy Ho investigation, while unconfirmed, several sources believe it became public through clandestine efforts as a result of Wynn's attempts to discredit [her] suitability for licensure at the eve of the NGC review. I repeat, this is only speculation that has been circulating all over the place + I have no personal knowledge of the validity of this claim.

February 27, 2007 10:06 PM Posted by John

Leonard, how can you say Adelson will be able to gain control of Wynn Resorts? I know Wynn has seen a stock price decline over the past days/weeks, but LVS has been falling like a bowling ball through thin air. Honestly, LVS' stock has fallen ten percent since 21 February 2007. However, I do have to agree that Wynn didn't make the splash in Macau big enough to the point where he could attract that majority of whales. He might be able to attract a larger number of them with the Diamond Suites but I'm doubtful on that. In all honesty, I think the resort will eventually find its niche as a boutique style gaming resort offering a very high end experience but failing to catch what the Venetian is going to have. However, this brings up a point over occupancy rates. How can we expect the Venetian, with its over 3,000 rooms, to be able to prosper when the newest resort in Macau is only pulling in an 80% occupancy rate (with a 61% suite occupancy rate)? From my vantage point, LVS had better have some HUGE conventions in line for those rooms to be filled on a regular basis.

One last point, I think Wynn is going to do something that I suggested on the blog a couple of months ago. It is obvious that the golf course will not be developed until maybe two or three years after CityCenter and Echelon have come online, for the simple reason that if Wynn opens a new property along with those other two facilities, the market will be overflooded. So, I can really see the golf course staying in place for, at least, another five years or more. Does anyone, Leonard, Hunter, etc., think I'm wrong in this assumption, or will we see a large scale project completed in the next three years?

February 27, 2007 10:08 PM Posted by Hunter

I think you're right - Wynn will (should) wait on the golf course - generate some money from operations, pay some debt, etc...

February 27, 2007 10:10 PM Posted by John

Leonard, in addition to my last post, when you compare the free fall of LVS' stock (down 10%) and compare that to WYNN (with a 6.39% fall over the same time period mentioned above) how can you say that WYNN is clearly LVS' prey? Maybe I'm not seeing something here, unless of course the inevitable will happen and WYNN free falls as well tomorrow over this news, which may not happen due to that better than expected EPS.

February 27, 2007 10:55 PM Posted by David F.

Further reading of reports of the AP and Reuters show that all of todays stock movements for WYNN, LVS and MGM took place before the earnings announcement....

Personally I will see what the feedback on the Q4 earnings are tomorrow, from 'informed' people who are probably not quite so partial... one way or the other... and definitely less hysterical....

February 27, 2007 11:20 PM Posted by motoman

David F, very reasonable. The whole market took a bath today, all sectors affected.

And far be it for me to defend our resident troll, but just to show I'm fair, John you might've missed his point: he didn't say LVS would "take over" Wynn as per MGM taking over Mirage, but rather that LVS would overshadow/outperform Wynn. Which as he's pointed out before (thus kicking a dead horse now), they've already done. In spades.

February 27, 2007 11:31 PM Posted by Mike E

Screw stocks! Encore's duplex "sky villas" officially announced! *Drool*

February 27, 2007 11:47 PM Posted by Leonard Stern

John, First of all Sheldon Adelson will soon become the richest man in the country. That speaks volumes in + of itself. Secondly, Steve will most probably not be in the financial position to even consider actual development of the golf course property until AFTER CityCenter + Echelon are completed. They [WD+D] have been working on numerous mixed-use preliminary schematic masterplans of various types, including privately owned condominium towers, condo/hotel venues, etc. a la CityCenter/Echelon only more spread out for that property, which I have personally had the opportunity to have viewed, and honestly it is still "typical" Wynn-inspired crap on the same level of WLV + Encore. What will ultimately end up actually being constructed, in at least a minimum of three to four years time on that massive property, will unfortunatley be totally consistent with what everyone expects from Wynn, mediocre tower design that keeps repeating itself with respect to both inferior interior design execution + landscape architecture. (i.e. Butler/Ashworth, Roger Thomas + Lifescapes, Int'l.) Steve is betting that Encore, in conjunction with the existing WLV, will be able to compete with the world's largest hotel, Venetian/Palazzo next door. In addition, WLV + Encore doesn't have a chance in Hell of holding their own against CityCenter. If Ruffin follows through with Steelman's atrocity, Montreux across the street, maybe Wynn has a chance. Word is that Ruffin might abandon the project altogether + sell off the New Frontier property. Too bad that there will still eventually be TWO of the tallest + UGLIEST towers in the city, TRUMP. The architectural community refers to Joel [Bergman's] design as the "Gold Popsicle". The morons that paid big bucks for these units based on the Trump name alone, don't realize that a condo tower, sans terraces, balconies or even operable windows, have no idea what a residential high rise needs to include in order to be considered a residential tower + not simply an office building. HVAC issues aside, every condo tower from Sky, Allure, Turnberry, Panorama, etc. at least have terraces, balconies or operable windows. However I digress, WYNN is in a very perilous position right now. I have spoken to four of the top gaming sector analysts in the business over the past several weeks, + with the exception of only one, they all predicted a 2006 Q4 loss. Personally, believe it or not, I expected this to be a significantly profitable quarter for WYNN myself based on their Macau revenues. The future for Wynn Resorts, Ltd. doesn't appear to be all that rosy!

February 28, 2007 12:18 AM Posted by Chris B

Re John's comment about LVS filling rooms at the Venetian Macau, I know that there is a telecoms conference already slated for the Venetian later this year that will have roughly 20,000 attendees, so there's at least one week's rooms filled to capacity (and a healthy spill-over effect for other hotels in Macau). I expect LVS to do quite nicely with the convention stuff - all you need to do is think about all the myriad products that the rest of the world buys from China now, and then imagine that the Venetian will be offering a convenient forum far more appealing than any existing forum in China (and surrounded by the allure of casinos) for all the sellers and buyers of those products to meet, and I think it becomes easy to imagine that there should be more than enough convention business out there for LVS (provided of course it can build the right networks with trade show organizers).

February 28, 2007 6:04 AM Posted by Punter

Crazy day in history but I'm with the Wynn bulls on this one. The numbers were very good, look at the tick sizes and you'll see the sell-off in Wynn was almost exclusivly retail driven. Yes there was a net loss but it was because of the payoff to the converts, that's a one-time charge. Otherwise he beat EPS, EBITDA, and revenue expectations by a lot on both properties. As some of you know I've moved over to Asia for business but I get up a lot through the night to check email and what the market's doing (bond markets losers, not stocks). But yesterdays carnage was worth watching, a little before the close I loaded up on various exp. Wynn calls which I rarely do but I just thought that sell-off was nuts (and you can read my post on WBTALV for my thoughts on the market sell-off here in Asia and in NY). So now I'm effectively long 20,000 shares of Wynn - Brian I'm with you buddy.

February 28, 2007 7:57 AM Posted by BrianFey

Man, some imagination you have. First of all, Sheldon will not be the richest person in America. He will not surpass Gates or Buffett. Wynn has less debt than anyone else he competes with. I don't know where you come up with this stuff?

February 28, 2007 9:23 AM Posted by Leonard Stern

Well Brian, this "stuff" comes right from the horse's mouth, Sheldon himself! Buffett has already given over 80% of his wealth to the richest man, Gates' foundation. I guess we will have to just wait + see won't we, after [he] personally redefines the entire future of the massive Chinese gaming market by monopolizing Cotai? That't doesn't even take into consideration the personal wealth he will be generating for himsef by way of his exclusive position in the $3.6B mega-casino resort in Singapore which just broke ground. According to Forbes, he needs less than $35B to surpass Gates at the current time. Oh well, Adelson might just have to settle with being the third richest for a while. BTW, how long did it take [Adelson] to get to that esteemed position, let me see, oh yeah, something less than nine years! For Christ's sake, he personally controls 88% of the whole damn operation! You do the math.

February 28, 2007 12:12 PM Posted by mike_ch

LS, you can stop lying, now.

I think all of us would be hard-pressed to believe that you're invited to some super-secret Wynn project viewing in the wake of your total disinterest in the company, your history and public laundry-airing with a number of it's figures, and that the project in question hasn't ever been considered anything more than speculative.

Unless you happen to be hanging around a bar at Wynn when Steve drew an idea for the golf course land on a cocktail napkin while talking to someone, then you went and fished it out of the trash when he threw it away. That would be a very private viewing, indeed.

And honestly, Leonard, if it turns out that people just don't like residences integrated into casinos after they've had a chance to buy some, MGM is in a perilous position compared to Wynn. That's why I think LVS has been playing it the smartest, watching the early jumpers build their projects, waiting for the demand to actually arrive before announcing the Palazzo condos.

February 28, 2007 1:27 PM Posted by BrianFey

Good to hear Punter. I think its a good decision, and will pay off many years down the road. I am starting to position myself in MPEL now, I know its a LONG way off, before it will do much, but I am a very patient person. I got 30 years to wait!

Leonard, Buffett has not given away hardly anything yet. But I know he plans too. I think he wants to pass Gates first though. :) Sheldon is brilliant and talented, but he is not even close to the same league as Gates and Buffett. He got lucky, cause the market has his company valued at a crazy high number. No way you can compare Wynn with a market cap of 10 Billion and LVS with a cap of 30 Billion. LVS isn't 3 times the company Wynn is.

February 28, 2007 1:31 PM Posted by BrianFey

Leonard, I just wanted to let you know that Jefferies raised their target price on WYNN to $111 after that great call. Get in now why you can. There is still time.

February 28, 2007 3:14 PM Posted by Leonard Stern

mike_ch: Get this straight you stupid f*ck. Don't EVER, EVER accuse me again of being a LIAR on a public forum! I can assure you that I will locate your true identity with relative ease + sue your damn ass off! I've had enough of this mudslinging, malicious + defamatory comments directed towards me. I thought we had all reached an amicable truce some time ago, but evidently you wish to continue to perpetuate these unprovoked attacks. You have NO personal knowledge whatsoever of WHO I know, WHAT I know to be either fact or speculation + I can assure you that I stand by my comments 100% with respect to having viewed schematic/preliminary masterplan studies for the WLV golf course. So pull you head out of your ass + don't accuse me of fabricating facts I know to be truthful. Let me remind you, because I have voluntarily revealed my true identity on this blog, you are exposing yourself to a defamation lawsuit. If you think I am living in some sort of fantasy world just call my bluff!!! FYI - I NEVER stated that I was invited to "some super-secret Wynn project viewing" as you falsely assert. I can also assure you that I didn't come to view these proposals from some scribble on a damn cocktail napkin! Until you are able to offer constuctive input why don't you just shut the f*ck up before making accusations as evidenced in your previous post...Have I made myself clear, genius?

February 28, 2007 4:00 PM Posted by Punter

Brian, I don't know what you're thinking but 30 years is way to long to wait for retirement and I'm younger than you! haha, no I'm not in it for the long haul, my longest options expire in Jan. It's just a punt, will re-evaluate down the road.

Leonard, I agree with you on Adelson at least currently having the lock on Singapore. It's going to be built less than 10 mins away from my office. The Sentosa project is huge but because of everything else Singapore has to offer I think a development right on the island will still attract more play (The Genting project will be more of an overall theme park/resort anyway). But I don't know what you mean about Adelson monopolizing the Cotai strip. I've worked with Galaxy (biggest local developer after Ho) on some investments and not only do they have first mover advantage on Cotai but they also have the largest land options. More importantly though is most of Cotai isn't parceled out yet, everyone from Wynn to Ho's little grandkids still need to secure tracts on it. I don't know if you've been to Macau yet but let me tell you that Sands doesn't hold a candle to Wynn. The Wynn Macau is miles beyond anything over there right now, even much nicer than the nicest little city club casinos. And this is coming from someone with a history of being very skeptical about Wynn. I still have my doubts about Wynn's Las Vegas future for various reasons but in Macau he's in a class of his own.

February 28, 2007 4:57 PM Posted by Hunter

Guys, let's get back on topic please - this is an important discussion and I don't want to have to close it.

I can understand Leonard taking strong exception to being called a liar - I know that I would want to defend myself.

Still, this could quickly snowball into an all-out war and this isn't the place for that.

February 28, 2007 6:28 PM Posted by mike_ch

Yes, it's gone off track. And I would have apologized for calling Leonard a liar except for his outrageous reaction and lawsuit threats over things I know one can't sue for. Sorry, guy, but it's not libel unless I knew my accusations are false but made them to damage you, which isn't the case because I can't say for sure whether your private meetings actually happened or not.

Regardless, my point was that even he would know that a building that isn't even supposed to break ground in over a year's time may look like garbage this early in development may not turn out garbage. I'm sure he's probably seen a few buildings in his time that looked bad in the early stages and turned out great. You never know.

February 28, 2007 6:31 PM Posted by Leonard Stern

Punter, let's all just wait to see the actual numbers after MGM Grand Macau opens later this year. One couldn't have a a closer neighboring major (larger) competitor than MGM Grand next door, now that the Pansy Ho partnership issue has been approved/resolved. MGM Grand Macau is a far superior property from an architectural standpoint than Wynn Macau which is s stripped down, stunted version of WLV + the Macau towers lack any of the exterior detail of the already mediocre Las Vegas tower property, including Encore. You state that Wynn is in "a class of his own" in Macau for now, at the present time + I can asssure you that it will be short-lived! Even after Wynn Macau's second phase tower expansion, MGM will definitely, substantially eat away at their [Wynn's] bottom line in a big way. Hunter, you know exactly who provoked + instigated this "war" + it was mike_ch! I see two choices here at this juncture, I am aware that you personally know this guy, either cause him to apologize to me on this forum + refrain from ever posting any future defamatory comments toward me or I guess you will need to permanently ban me from this bloq because I will do whatever I deem necessary to straighten this moron out once-and-for-all on my own. I'm really pissed off over this. His libelous comment was totally unprovoked + out of line. The choice is up to you.

February 28, 2007 6:41 PM Posted by mike_ch

Leonard, can we move along? I realize I went out of line with my comment, however your threats of relation were to me equally out of line.

Since we've both made each other uncomfortable can we just agree that we're even and continue along, water under the bridge?

February 28, 2007 6:48 PM Posted by mike_ch

"Relation" should have been retaliation, sorry.

Point is, if you had just demanded an apology at the start without threatening to sue me, you would have gotten what you wanted because upon reflection I realized that wasn't the right thing to say.

If we continue down this road we're just destroying any chance of real conversation on the original topic, I hope this resolves the matter.

February 28, 2007 7:12 PM Posted by Brian Fey

I do have to say, Leonard, I don't see how you say MGM will eat Wynn's lunch in Macau. Its funny yet the only property in LV doing more casino business than Wynn is Bellagio. Even your beloved LVS generated less casino revenue this past quarter than my stinky old Wynn.

February 28, 2007 7:50 PM Posted by detroit1051

Leonard, the Pansy Ho issue has now moved to New Jersey. I've never trusted James Dobson, and it doesn't surprise me to see him the leader of this attack:
"...Rev. Gary Kellner, a longtime anti-gaming activist and follower of Dr. James Dobson, a religious figure often credited with helping President George W. Bush win the evangelical vote in the last two presidential elections."

February 28, 2007 7:51 PM Posted by John

I've been really excited about MGM Grand Macau since I saw some of the renderings in an MGM Mirage investor slide show. However, I don't think, first of all, the MGM Grand brand has the luxury conotation that Wynn and Bellagio carry (which makes me think we'll see a Bellagio in the UAE) . However, herein lies my point. While MGM will create a property that I think will blow a lot of people away, the resort name itself is just too much to turn people away and make them head for a resort with a much more recognizably luxurious brand name. As most of us should know, a name means so much more to so many people, than the property itself does. Moving past that, I think others have probably seen it, but it looks like the MGM Grand atrium is going to be open air. I don't know about the Macau weather patterns, but you wouldn't one think it is a very rain prone environment? In my opinion, I would think a Bellagio conservatory-stlye glass ceiling combined with the MGM Grand Mansion atrium would be much more feasible, but there might be factors I'm not that aware of that play into this.

Back to MGM Grand Macau, though I am very excited about the casino interiors along with the rooms which are very promising. Also, doesn't MGM still have a huge hurdle to get over with the New Jersey Gaming Commission? Even if they don't find Pansy suitable, and MGM sells off their share in the Borgata, but don't they also own 71 acres of prime development space (that they have been promising to develop for years now) that they would have to sell? However, I have to say Macau and China in general is a much better corporate investment that Atlantic City.

February 28, 2007 8:04 PM Posted by mike_ch

I think MGM Grand has enough cachet going for it. Those of us who are newer to Vegas know it for Emerald City and the Dorothy audio-animatronic, but it has a fairly glamorous legacy (just don't mention the fire) and Mansion/Skylofts/Signature have helped improved it's image in recent years.

Also, don't forget the resort component of CityCenter. Although the collective project is called CityCenter there's still the opening for them to come up with a new name for the hotel/casino component of the complex, and they could adapt that to UAE or elsewhere.

February 28, 2007 8:13 PM Posted by Leonard Stern

mike_ch: It is YOU who owes ME an apology in the first place. I reacted after-the-fact when you posted libelous comments by calling me a LIAR. I am really pissed off at this point because you know that I am a regular contributor here + my identity + background have been made totally transparent/confirmed. I'm NOT going to apologize to you under any circumstances for threatening to sue you, trust me, unless you back off, unconditionally apologize + refrain from ever posting future defamatory or otherwise similar malicious remarks, I WILL indeed prepare to proceed with a lawsuit against you. No B.S. Under the specific circumstances, I have the absolute ability to locate your true identity + file the appropriate complaint. You should have had the common sense, given my history on this forum, to not EVER accuse me a of being a LIAR! I have never misrepresented ANYTHING on this forum, + if my information was "speculative", I would have made that clear in my post. I have been accused of a lot of false unscrupolus things in my professional career, however, I have NEVER been accused of fabricating untrue or unsupported facts, i.e. being labeled as a liar! I'm afraid the next move is in YOUR court...

February 28, 2007 8:20 PM Posted by Hunter

I think everyone should take a step back and calm down for a minute... Mike clearly went too far and he copped to that... Let's just all take a break and relax and I hope that when we come back and look at this again, we'll agree that an unfortunate comment was made, subsequently owned up to and now it's time to move on. I'm sure we all have better things to do than lob missiles back and forth, right?

Heck, you guys live in the same city - Mike can buy you a beer!

February 28, 2007 9:24 PM Posted by Punter

John, the MGM name itself might now conjour up images of luxury to the Vegas crowd but it's entirely different out here. MGM has by far the largest marketing presence in Asia, they have offices throughout China, Hong Kong, here in Singapore, Tokyo, and somewhere else (I think Seoul). They've had this marketing presence here for a long time and it's the reason they've always been able to court Asian high rollers to places like the MGM Grand and the Bellagio. They won't have a problem courting high rollers.

You also need to keep in mind that the resort model hasn't been tested yet in Macau. Everything there right now is a casino without much else, for the most part Macau is a crappy city with a lot of ghetto buildings and all around dirty and spread out. At least in the near term before any cultural shifts or major urbanization of Macau the casinos that will be on top will do it solely on the casino side of their business. Hotel rooms and things like that aren't going to be a big part of it. Think about it, they also have Hong Kong to compete with on that front where you have a ton of high-end hotels. The Peninsula on Kowloon is one of the nicest hotels in the world, I bet you many Macau high rollers end up staying there simply because of its reputation/quality and the fact that they can split time between Hong Kong and Macau. Imagine if you moved Vegas to within 30 mins. of New York City. How important do you think your hotel business would be?

February 28, 2007 9:33 PM Posted by Leonard Stern

Hunter, Honestly this particular episode with mike_ch has really pushed the envelope this time + is absolutely inexcusable. You know that I'm right on point with this. All mike_ch has to do is unconditionally apologize + we can then be able to move forward in a positive direction. Mike has not "copped" to anything. He has crossed the line + I intend to hold him 100% responsible for his libelous comments. BTW - I don't drink beer, only Grey Goose Vodka, straight up, "shaken, not stirred"...

February 28, 2007 9:39 PM Posted by Hunter

I'm a Grey Goose fan as well.

i'll sometimes add some grapefruit or orange juice but I try to stick to Grey Goose whenever possible... Actually, I have one right here.

That or some good red wine. I don't drink beer that often anymore either.

February 28, 2007 10:03 PM Posted by Mike E

Goose is only good when you plan on hitting it hard for a nice, clean drunk (no hangovers, no sickness). Otherwise, there are tons of better tasting vodkas out there for much less (Stoli comes to mind).

February 28, 2007 10:14 PM Posted by Hunter

Not to drag this too far into booze-talk but I thought you were a Goose man, Mike?

I like Stoli as well but beyond those two, I don't really venture out. And I don't go for any flavored stuff at all.

Wine-wise, I'm lucky to live in a region that produces good Pinot Noir, my favorite.

February 28, 2007 10:34 PM Posted by Mike E

In Vegas, I'm a Goose man for a few reasons:

-It's usually comped.
-I hit the booze harder (the same amount in Stoli would kill me come morning).
-When hosting, it's always a good bet.

But outside of Vegas, things are different. I can't remember the last time I bought a bottle of Goose for my own collection or ordered it at a local bar.

March 1, 2007 6:22 AM Posted by Christian

Wynn - MGM - Macau - City Center - Threats - Lawsuits - Threats - Admissions - Grey Goose - Beer.


March 1, 2007 2:21 PM Posted by detroit1051

Wynn released its 10-K today. I haven't followed Encore's construction contract and am surprised at the following:
"On February 27, 2007, we entered into a Design Build Architectural, Engineering and Construction Services Agreement (the �Contract�) with Tutor-Saliba Corporation (�Tutor�) for the design and construction of Encore. The Contract sets forth all of the terms and conditions pursuant to which Tutor will design and construct Encore.
In addition to the terms and conditions governing the design and construction of Encore, the Contract provides that the parties will negotiate a guaranteed maximum price (the Encore �GMP�) for the construction and design of Encore within 90 days of execution of the Contract. If the parties cannot mutually agree upon a GMP during the 90 day period, the Company can, at its option, (a) continue to employ Tutor for construction and design services on a cost-plus basis, (b) agree to alternative arrangements with Tutor or (c) terminate the Contract. In connection with the execution and delivery of the Contract, Tutor and the Ronald N. Tutor Separate Trust (the �Trust�) have entered into and consented to a Net Worth Agreement pursuant to which (x) the Trust agreed that it will retain its current majority holdings of Tutor and (y) the Trust and Tutor agreed that during the term of the Contract, Tutor will maintain (i) net worth of at least $100 million, and (ii) liquid assets of at least $50 million."

Hasn't there been a contract since construction started? Should I read anything into the relationship between Wynn and Tutor?
Thanks for any help you Wynn experts can give.
The entire 10-K is at:

March 1, 2007 2:24 PM Posted by Hunter

I'm fairly certain there has been a contract, yes... I believe what this represents is that the high-rise and the low-rise are now design frozen where in the past, they were making changes.

I'm told the drawings I saw of the building are no longer up to date (time to see new ones)!

I remember reading the Q12006 quarterly and they were talking about the GMP contract with Tudor there as well. As far as I know there is nothing to see here.

March 1, 2007 6:12 PM Posted by John

Well, Wynn Resorts presented today at the Bear Sterns conference and it looks like the Encore stats have changed considerably. The casino has been expanded to a size of about 75,000 sq. ft., which leads me to think the 50,000 sq. ft. of botanical gardens were just a tad too much. Also, another interesting note, the resort will have multiple nightclubs, not just the pool-side nightclub that is beeing promoted as the nightclub to end all nightclubs.

March 1, 2007 6:43 PM Posted by Hunter

Yeah, I saw that Bear Stearns thing.

I will go and check up on Encore's latest drawings the next time I'm in Las Vegas...

Regarding the nightclubs though, keep in mind that they consider 'Lure' a nightclub and I personally wouldn't think of it that way really, so when they pluralize nightclubs, don't expect two Tryst-level clubs.

March 1, 2007 8:06 PM Posted by detroit1051

Speaking of Lure, "Eye" devotes some space to it:

March 2, 2007 11:26 AM Posted by Leonard Stern

Detroit: This is actually the second + final contract between Tutor-Saliba Corp. + Wynn Resorts, Ltd. for completing Encore based on the "finalized" design + the continued escalating construction costs for materials, labor, etc. Encore has apparently been running seriously way over budget, from what I've been told, since day one, that's why its progress has been significantly slower that that of Palazzo (Taylor, Int'l.) + CityCenter (Perini/Tishman). The original contract [for building Encore] is abvailable online through a subscription service, which I will try + locate. At ant rate, Tony [Marnell] had a GMP of a hair under $1B for WLV + despite the millions upon millions of dollars in legitimate additional change orders submitted, he lost his shirt on that project. Don't expect Marnell-Corrao to be General Contractor for any of Wynn's projects in the near future, even after they have both enjoyed a very close twenty year + relationship between them. All of Wynn's projects are notoriously known for generating the most number of change orders for GC's than ANY other operator/developer because Steve keeps changing his mind during + AFTER major components are actually completed simply because "he doesn't like the final results". Tutor-Saliba will undoubtedly not derive a significant profit margin in building Encore, as Tony learned with WLV. Pretty soon Steve is going to run out of top-ranked GC's like Perini who would consider building his projects without [Wynn] having to pay a major premium. Hey Christian, Wynn, CityCenter, threats, lawsuits, admissions, Grey Goose + beer certainly spice up what would otherwise be a rather boring thread, don't you think? :-)

March 4, 2007 2:13 AM Posted by motoman

Pinot Noir?
Here in the Pacific Northwest, we're rather fond of Oregon's product. Not that I'm an afficionado by any means but it's earned a name for itself. I like it.

Chris B, excellent points about Venetian Macau and conventions. Adelson no doubt will leverage all he's learned from his Comdex days about filling rooms with conventioneers, esp. as you noted about all the Western trade with China. Too perfect.