Poker

MGM Resorts Sells Two More Las Vegas Strip Properties To Blackstone


Before the COVID-19 pandemic put a halt to most economic activity, especially in Las Vegas, MGM Resorts was unloading its Las Vegas real estate to raise cash on hand.

It recently restarted its “asset-light” business strategy as it entered into an agreement with Blackstone to purchase two more pieces of Las Vegas Strip real estate.

The deal with Blackstone is pending the purchase of CityCenter by MGM Resorts. According to the Wall Street Journal, the gaming giant MGM plans to buy out Infinity World Development Corp of its 50% stake in the complex comprised of Aria Resort & Casino, Vdara Condo-Hotel, the Waldorf Astoria, the Shops at Crystals and Veer Towers.

MGM will pay the subsidiary of Dubai World $2.1 billion and become the sole owner of the entire complex, at which point it will start the sale of Aria and Vdara to Blackstone.

Blackstone will buy the two pieces of real estate for a combined $3.89 billion. Like MGM did with other casinos over the last few years, they will own the casino business, but pay rent to Blackstone, which will own the physical real estate asset. The $3.89 billion represents the equivalent of 18.1 months of rent.

The New York-based investment management company already owns pieces of four casino properties on the Las Vegas Strip. It purchased the Cosmopolitan Las Vegas from Deutsche Bank in 2014 before making multiple deals with MGM in 2019 and 2020.

In October 2019, Blackstone bought the Bellagio from MGM for $4.25 billion. Just a few months later at the start of 2020, MGM sold MGM Grand and Mandalay Bay to both Blackstone and its own real estate investment trust, MGM Growth Properties. MGP owns 50.1% of the two more recent properties sold.

“This transaction demonstrates the unprecedented premium value of our real estate assets and is a testament to Aria and Vdara’s status as premier destinations on the Las Vegas Strip,” said MGM CEO Bill Hornbuckle in a statement. “We expect to continue executing on our asset-light strategy and utilizing the proceeds from our real estate transactions to enhance our financial flexibility and secure new growth opportunities.”

 

 

 





Source link

Related Articles

Back to top button