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October 23, 2018

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Wynn pushes resort opening back to original date

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The Associated Press

A worker operates an earth-moving machine in front of the construction site of Wynn Palace along Cotai Peninsula in Macau in May.

It was at the launch of his daughter’s slipper line that Steve Wynn performed some deft footwork to explain the timeline for opening Wynn Palace in Macau.

The $4.1 billion resort on the Cotai Strip was supposed to open March 25. That date recently was pushed to June 25.

“What has happened is, for the past six months, the builder, Leighton, had a 90-day completion bonus of $38 million,” Wynn said. “March 25 was the date. They had been telling us up until two or three weeks ago, ‘We’ll make it,’ and they had to tell us in advance so we could start hiring people for the whole run-up to the opening.”

“As it happened, 10 days ago, they told us, ‘We’re not going to make the 25th,’ because they have hit some complications in installation. We had been using March 25 as the date, so I had to make another announcement (of the June 25 opening).”

Wynn said his builders often get “heartburn” during his review of properties.

“It’s all the little stuff, you know, with me asking, ‘Is this up to standard? No,’” Wynn said. “The chrome is scratched on the window. This gap in the molding hasn’t been filled and stained and sanded yet. We’ll take a moment to put on the wall a list of corrections, a punch list. They have a week to do it, and then we give them a second punch list, and that’s always where the rubber hits the road in the last seven or eight hotels I’ve done.”

Leighton has financial motives to hit the June 25 deadline and to meet construction benchmarks in December and January.

“If they don’t make June 25, it’s a $1.5 million-a-day penalty,” Wynn said. “If they don’t have the first five floors done by Dec. 24 and we have accepted them, it’s $200,000 a day. Then, on Jan. 24, if they don’t have the next 10 floors, it’s $200,000 a day. They say they are in good shape — but they’re not going to make the early bonus.”

Wynn said this sort of adjustment is common.

“We weren’t delayed, but I got misled by my builder and not in a mean way,” Wynn said. “They just bumped into some problems. But the furniture has been ordered and the fountains have been tested.”

Wynn also explained his frustrations with Chinese government officials, who have not yet specified how many gaming tables Wynn will be allowed at Wynn Palace.

“None of us are really clear on what our environment is going to be like going forward, and it makes planning and adjusting almost a mystical process,” he said during an October conference call. “The notion that a person who spent $2.5 billion — I’m talking about Melco now — would not know how many tables they’re going to have three weeks before they open is so preposterous that it’s worthy of comment. We are hopeful that we’ll be able to press the issue and get more clarity from the leadership of the local government.”

Melco Crown Entertainment Ltd.’s Studio City resort was awarded 250 gaming tables seven days before its Oct. 27 opening.

“I think, in the long run, the government will do the right thing and be more understanding,” Wynn said. “They have their way of looking at it, which is not the same way a businessman has of looking at it. That’s true in this country, as well. I was probably a little tougher on them than I should have been on the conference call. But look, I have made promises to the people over there, and it’s only fair that they help me keep those promises. But it wasn’t as serious as everyone made it out to be: ‘Wynn blasts government.’

“I didn’t blast anybody. I’ve been their fair-haired boy in Macau since Day One. But it’s OK to complain a little. It’s OK to have a different point of view.”

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