Las Vegas: VICI closes $1.3B acquisition of remaining MGM Grand, Mandalay Bay stake

Real estate investment trust VICI Properties has completed its buyout of MGM Grand and Mandalay Bay’s real estate. The acquisition further cements the casino landlord’s ownership of huge resorts along Las Vegas Boulevard.

VICI, which already owned a 50.1% percent stake in the properties, announced Monday that it closed its purchase of the remaining 49.9% from financial conglomerate Blackstone. The deal, which was first announced last month, called for VICI to pay around $1.27 billion in cash to Blackstone and assume that firm’s share of the debt on the resorts.

MGM Grand

According to a presentation retrieved by Las Vegas Review-Journal, VICI is assuming 49.9% of a $3 billion debt load, or nearly $1.5 billion. The two properties are leased to casino heavyweight MGM Resorts International: when the next rent hike kicks in March 1, MGM’s annual rent for the casinos is expected to total around $310 million.

The acquisition comes amid a burst of Las Vegas deals over the past few years that have shuffled resort property ownership around. Billions of dollars have changed hands as casino resorts around the Strip are now leased to rent-collecting landlords.

Mandalay Bay

VICI, a Caesars Entertainment spinoff, has emerged as the biggest property owner in the corridor, with assets amounting to more than 600 acres. Its portfolio also includes Caesars Palace, Harrah’s and The Venetian; as well as MGM Resorts-operated properties Luxor, Excalibur, New York-New York, Park MGM, and The Mirage.

For its part, Blackstone still has a big presence on the Strip through ownership of other massive MGM-operated hotels. The financial conglomerate purchased Bellagio’s real estate for $4.2 billion in 2019 and bought Aria and Vdara’s real estate in 2021 for nearly $3.9 billion. It also still owns a stake in The Cosmopolitan of Las Vegas’ real estate – it purchased the hotel-casino for $1.73 billion in 2014 and sold it for $5.65 billion in a deal that closed last year.

In addition to expanding its presence in Las Vegas through the MGM Grand and Mandalay Bay acquisition, VICI moved forward with international expansion plans this week by announcing it will acquire the real estate assets of four casinos from PURE Canadian Gaming Corp.

The four properties – PURE Casino Edmonton, PURE Casino Yellowhead, PURE Casino Calgary and PURE Casino Lethbridge, all located in the province of Alberta – expand VICI’s footprint into Canada, its first international market.

The purchase, announced Monday, was carried out for an aggregate price of approximately CAD 271.9 million ($200.8 million). “Today’s announcement marks another momentous first for VICI as we expand our footprint internationally into Canada with the acquisition of the PURE portfolio,” said John Payne, President and Chief Operating Officer of VICI Properties.