Wynn to pay MOP 392 million to third party for Cotai land

The MOP 392 million payment will be made within 15 days after the SAR Government publishes the company’s rights to the land in the Official Gazette, Wynn said

Wynn Macau has applied to the SAR Government for a land concession on approximately 52 acres (202,342 square metres) of land on Cotai and is awaiting final government approval on the concession. But the company chaired by Steve Wynn will have to pay USD 50 million (MOP 392.2 million) to a third party if it gets the Cotai land concession.
“On August 1, 2008, subsidiaries of Wynn Resorts, Limited entered into an agreement with an unrelated third party to make a one-time payment in the amount of USD 50 million in consideration of the unrelated third party’s relinquishment of certain rights in and to any future development on the 52 acres of land in the Cotai area of Macau,” the company reiterated in the latest quarterly report.
“The payment will be made within 15 days after the Government of the Special Administrative Region of the People’s Republic of China publishes the company’s rights to the land in the government’s Official Gazette,” Wynn unveiled, without naming the third party.
For now, the report added, “the company continues to work on the concept and design of this property, but cannot prepare a final timeline or budget until Government approval on the land concession has been received”.
Even without getting the formal concession, Wynn Macau has already put up a fence encircling the area next to City of Dreams and Macau University of Science and Technology (MUST).
However, Wynn Macau did not disclose the name of the third party. “We cannot comment on stock exchange filings,” a spokesperson told the Macau Daily Times.
This is not the first time that a third party is involved in a development project by a gaming operator in Cotai.
Roughly two years ago the Government had to negotiate with MUST to get back two parcels of land, one of which would afterwards be granted to Melco Crown. The company co-chaired by Lawrence Ho and James Packer got land with an area of 113,325 square metres, from which 73,546 square metres formerly belonged to MUST. In 2008, Melco Crown paid MOP 842,134 million for the land City of Dreams, Crown, Grand Hyatt and Hard Rock Hotel sits on today.
However, the move was heavily criticised by different sectors, because the Government agreed to give another two parcels of land to MUST with a bigger area. In the end, MUST gave back the land with a total area of 84,899 square metres, but as a compensation was granted two pieces of land with a total area of 145,621 square metres, according to the Official Gazette. In total, MUST was granted an area of 212,046 square metres in Cotai.
The university is run by a foundation, and due to that status didn’t have to pay a premium for the land.
According to a map in the Official Gazette, one of these two new parcels that MUST received from the Government, with an area of 26,578 square metres, which value was estimated by the Government at MOP 26.5 million in 2008, sits just beside the land where Wynn plans to build his unit.
Wynn Macau's Cotai project could break ground next year and be ready by 2014, Steve Wynn said.