Long story short, Wang made the "deadline" right when the team was announcing a preseason game in Kansas City. He put that deadline on October 3, the date the Islanders played their home opener and would debut Tavares.
He pretty much was using these dates for the biggest media/PR hit possible. He was trying to whip as many fans (aka VOTERS) into a frenzy and pepper politicians with pressure to put through the Lighthouse.
His goal is moving into a new home ASAP.
Technically, there IS an out-clause, but the politics involved are such a big factor, and there's virtually zero chance he has the opportunity to exercise that clause.
This isn't JUST about an arena. An arena could make the TEAM profitable, but not profitable enough for him to recover his losses. He'd be $850 million in the hole if he just built a new arena with zero chance of recovering all he's put into the Islanders. The project he wants to build would recover so much revenue, he can build a new arena himself.
The odds of the Islanders moving out of the NYC area are remote.
For that to happen:
#1 - The Lighthouse Project (his real estate venture he's trying to build) would have to be blocked by the Town of Hempstead, when Nassau County and the State of NY have already backed it so fully, they have agreed to lease terms on the land.
#2 - The Nets arena in Brooklyn (The Barclays Center) would have to be either (a) killed completely or (b) built without an NHL rink, and the Borough of Brooklyn has already said they want the Islanders. They could apply pressure to the developers to include the rink/Islanders
#3 - Queens would have to fail in their bid to lure the Islanders. They are trying to develop the area near the Mets CitiField, and are planning on a convention center/civic arena. Their place faces hurdles and the timeline is moving a little slow for 2015, but...
The Islanders TV contract is SO massive, that staying in NY is the #1 priority for the franchise. In a new NY area arena, the Islanders could get to top 4 in revenue in the NHL with a good lease (and a bidding war between Brooklyn/Queens/Nassau could lead to one).
In KC, they could be about like St. Louis in revenue. Which isn't bad, but in New York, they could be almost the Rangers.