Cosmopolitan Las Vegas Sold
The landscape of Las Vegas is changing right before our eyes. No I am not talking about the ongoing struggles the city is having with staffing and the customer experience during Covid, but instead it is all about the ownership. Over the last few years a new era of Vegas has been quietly ushered in with so many of the city’s iconic properties changing hands.
Perhaps you didn’t hear about MGM Resorts selling off Bellagio or their namesake MGM Grand or even their big City Center hotels Aria and Vdara. Despite the fact that nothing changed on the surface, all of those properties have been sold over the past two years. Or at least the land and buildings have.
Separate Owners & Operators
This new era of Las Vegas is one that often has different owners and operators as gaming companies move to an asset light model and investment companies such as The Blackstone Group move in to buy the land. In fact Blackstone Group is now the owner of the land beneath Aria, Vdara, MGM Grand and Bellagio even though MGM Resorts maintains ownership over the operations.
While Blackstone has moved to increase their foothold in Vegas through these purchases, since 2014 they have owned and operated one of the more popular Strip casinos. Cosmopolitan of Las Vegas was under construction when the floor dropped from the economy in the late 2000s and was eventually finished by Deutsche Bank who financed the final bits of construction in an effort not to lose out on so much of their initial investment. In 2014 Deutsche Bank sold Cosmo to Blackstone for $1.7 billion after spending almost $4 billion to build it.
Cosmopolitan Las Vegas Sold for Big Profit
While Deutsche Bank lost big on Cosmo, Blackstone has done the opposite. In a bombshell announcement today it we learned that Cosmopolitan of Las Vegas has sold for $5.65 billion. As part of the deal a coalition of owners including a REIT owned by Blackstone will own the land while MGM Resorts will run the business under a 30 year lease with three 10-year renewal options.
In fact, when the purchase of Cosmo closes in the first part of 2022, MGM Resorts will own (the operations of) every major casino on the West side of the Strip between Russell and Flamingo Roads. Just as a reminder that is Mandalay Bay, Luxor, Excalibur, New York New York, Park MGM, City Center, Cosmopolitan and Bellagio with Mirage just a bit further north as well.
Cosmopolitan Las Vegas Sold – What Will Change?
With the sale of Cosmo, several other changes are likely to come including:
- Cosmo’s Identity player’s club will likely be removed in favor of M life
- Cosmo is a partner of Marriott while MGM partners with Hyatt
- We may see changes to operations to bring Cosmo in line with other MGM hotels
- Comps and other offers may change
- M life players should have access to comps and other benefits at Cosmo
- We may see Cosmo added as an option on MyVegas
Mark and I also discussed what we think of the sale this morning on a special episode of the MtM Vegas video podcast on YouTube. You can watch the video below.
Cosmopolitan Las Vegas Sold – Bottom Line
This is likely not the last big sale in Las Vegas we will see in the short term as several properties such as Venetian, Tropicana, Cosmo and Palms are all in transition to new owners and others such as Planet Hollywood and Mirage are rumored to be up for sale. No matter what happens it is getting more and more difficult to explain who owns what in Vegas and that’s not fun.
What do you think of Cosmopolitan Las Vegas being sold?