MGM Grand and Mandalay Bay have been sold for $4.6 billion. Which is only news to you if you don’t read headlines, but whatever.
According to a news release, MGM Growth Properties (MGP) and Blackstone Real Estate Income Trust (BREIT) will co-own the resorts. MGP will own 50.1% of the joint venture, and Blackstone will own 49.9%. Blackstone also owns Cosmopolitan.
Yeah, not exactly sexy, but news is news.
The bottom line is this deal is similar to the recent sale of Bellagio in that MGM Resorts will continue to operate the resorts.
The sale of MGM Grand and Mandalay Bay are part of a larger “asset light” strategy on the part of MGM Resorts. It also seems to be part of a larger “boring us to death” strategy involving REITs, lots of initialisms and companies paying themselves rent.
MGM Resorts’ initial annual rent will be $292 million. Which shouldn’t be a big deal until the recession hits, then everything goes to hell in a handbasket.
The deal is expected to close in the first quarter of 2020.