Bellagio Las Vegas Sold
Just a little over a month ago MGM Resorts International announced that Bellagio Las Vegas had sold to Blackstone Real Estate Income Trust. As of Monday November 18, 2019 that sale has been completed, however the logistics of it will make things seem as if it never happened.
As part of the sale, the Bellagio was purchased by a joint venture which is owned 95% by Blackstone and 5% by MGM Resorts. Despite the sale, MGM Resorts will continue to manage the property and lease it back from the joint venture company.
From the press release:
Blackstone Real Estate Income Trust (“BREIT”) and MGM Resorts International (“MGM Resorts”) (NYSE: MGM) today announced the closing of the previously announced 95%/5% BREIT-led joint venture with MGM Resorts to acquire the real estate assets of the Bellagio for $4.25 billion in a sale-leaseback transaction.
As part of the transaction, MGM Resorts has leased the property from the joint venture and continues to manage, operate and be responsible for all aspects of the property on a day-to-day basis.
More Sales Coming…
MGM Resorts has already announced the sale of their Circus Circus Hotel & Casino on the northern Las Vegas Strip for $825 million plus rumors continue to persist that MGM Grand is up for sale if they can arrange a similar leaseback option for it. MGM Resorts seems to be trying to raise capital to pay down debt in addition to funding their expansion plans for places like Japan.
Bellagio Las Vegas Sold – Bottom Line
With the Caesars/Eldorado merger happening, plus these minor ownership changes occurring on the Strip, the landscape is changing a bit in Vegas. The duopoly of the past 20 years is dying out and I predict we will see even more Strip properties change hands as these investment trust strategies become more popular and as Vegas reinvents itself yet again.
What do you think?