MGM Resorts still the Strip’s largest casino operator, just not its biggest landowner
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MGM Resorts International used to own more than 800 acres of land on the Las Vegas Strip. Now it owns just 15 acres. The company is focusing on asset-light strategy. It owns a 50 percent stake in BetM MGM, the company's sports betting and online gaming operation. MGM made an $11 billion buyout offer for Bet MGM in January, but it was rejected. The offer was made under UK law. Analysts believe MGM wants to buy the other half of BetGM. They say the $8 billion in cash from the transactions could make an acquisition more palatable.
MGM Resorts is selling its Strip properties to REITs. Las Vegas Sands sold Venetian, Palazzo and Sands Expo to VICI Properties for $6.25 billion. Penn National Gaming owns Tropicana Las Vega. It's leasing the operations to Bally's Corp. in April. The REits don't pay federal income taxes. They can grow and expand their business. In Las. Vegas, VicI has leases with five different operating companies for casinos in 11 states. V ICI also owns 27 acres of undeveloped land behind Baly’s, Paris, and Planet Hollywood.
MGM Resorts bought a 50 percent stake in CityCenter for $2.125 billion. The company will sell the underlying real estate to Blackstone Real Estate Investment Trust for 3.89 billion and lease the operations back from the landowner. City center's holdings include Aria Resort and Casino and Vdara Hotel. MGM Resort will earn $1.8 billion in cash following the transactions. The funds could be used to reduce the company's long-term debt. Bellagio was sold to the Blackstones for 4.25 billion, and MGM Grand Las Vegas and Mandalay Bay to a joint venture between Blackstock and MGM Growth for 5 billion dollars.
