Five years ago, the landlord of a new casino on the Las Vegas Strip rejected a takeover offer, saying an independent company had better prospects.
The company Vici Properties later bought the suitor. It was part of a multi-billion dollar outlay that made her the largest property owner in Las Vegas’ famous resort Her Corridor.
Vici doesn’t run a hotel on the Strip, its name isn’t even on the marquee, and even the CEO says people don’t know Vici inside the resort. But its portfolio includes many of the largest hotel casinos on Las Vegas Boulevard, from Caesars Palace, The Mirage and The Venetian to Luxor, Park MGM, Mandalay Bay and MGM Grand.
Its dominance highlights a major shift in the Las Vegas casino real estate market. In recent years, large hotels above and below the lucrative tourist corridor have been sold for billions of dollars to landlords who set huge rents.
economic vitality
David Kieske, Chief Financial Officer of Vici, spoke with Steve Hill, Chief Executive of the Las Vegas Convention and Visitors Authority, on Monday at Preview Las Vegas, the annual forecasting event hosted by the Las Vegas Chamber of Commerce. bottom.
Kieske reiterated his company’s stance that Strip is the world’s first automated teller machine, and said Vici had no plans to sell.
It owns tens of thousands of hotel rooms in Las Vegas. 660 acres along the stripand we generate about 45% of our total revenue here.
“The economic vitality of this road is unparalleled anywhere in the world,” Kieske said on Monday.
He also hinted at the risks that casino operators assume when renting properties, if inadvertently. When Hill asked if the resort would survive longer compared to Las Vegas’ past implosion because Bisci is the landlord, Keith said he thinks it will.
For Mirage, for example, it would be “extremely difficult” for a new operator to “tear down” the megaresort.
“If they want to do that, they have to pay us the same amount of rent,” added Keisuke. “They are legally obligated to do so.”
Hard Rock International, which acquired The Mirage business from MGM Resorts International last month for about $1.1 billion, will pay. First annual rent of $90 million.
Vici was launched as a spin-off from Caesars Entertainment in October 2017 when the casino chain’s main operating arm emerged from bankruptcy. By the end of the year, Visi’s possessions on the Strip consisted of Caesars his Palace and Harrah’s.
A buyer knocked immediately. On January 16, 2018, MGM’s real estate spinoff announced that he had reportedly offered to acquire Vici in a deal worth $5.85 billion. The next day, Vici told the board of directors: was denied sale.
“No one knows who Visi is.”
Vici has significantly expanded its holdings in America’s gambling capital with two high-value deals.
Casino operator Las Vegas Sands Corporation has announced that it will sell The Venetian, Palazzo and former Sands Expo and Convention Center to Bici and investment giant Apollo Global Management for approximately $6.25 billion in 2021.
Vici purchased the property for $4 billion and obtained a long-term lease with Apollo for $250 million in first annual rent.
Vici also announced that it will acquire MGM’s real estate spinoff in 2021. $17.2 billion buyoutgives Vici ownership of several MGM-operated properties along the Strip.
Two recent deals have further cemented its position on the Strip. Vici acquired full ownership of MGM Grand and Mandalay Bay earlier this month, as well as her ownership of Blackstone, a financial giant, for about $1.3 billion in cash and about $1.5 billion in debt.
Last month, Vici announced that it would offer up to $350 million. $2.2 billion construction loans From multiple lenders to the developer of Fontainebleau Las Vegas.
Blackstone, a major casino landlord that owns properties such as the Bellagio, Aria and Vidara, has put $500 million into financing, people familiar with the matter previously told the Review-Journal.
A massive shuffle of Las Vegas casino property ownership has changed owners of billions of dollars, with little, if any, visible impact on customers. Behind much of is a company that many have never heard of.
“No one knows who Bici is,” Kiescu said this week when he walked into a property owned by Bici officials.
Review-Journal is owned by the Adelson family, which includes Dr. Miriam Adelson, a major shareholder of Las Vegas Sands Corp., and Patrick Dumont, President and Chief Operating Officer of Las Vegas Sands.
Please contact Eli Segall at [email protected] or 702-383-0342. Follow @eli_segall on Twitter. Review-Journal Assistant Business His editor Richard N. Velotta contributed to this report.