Photo byShutterstock

|

LAS VEGAS—Blackstone Real Estate Income Trust and MGM GrowthProperties have struck a deal for Blackstone to acquire a 49.9%stake in the MGM Grand and Mandalay Bay for $4.6 billion. Inaddition, BREIT will purchase $150 million in MGP Class Ashares.

|

At closing, MGM Resorts International will enter into along-term triple net master lease for both properties. MGM Resortswill continue to operate the properties on a day-to-day basis, withthe joint venture owning the properties and receiving rentpayments.

|

The deal will allow MGP to maintain pro rata net leverage of5.6x, says CEO James Stewart in prepared remarks.

|

This transaction follows a deal struck last October between Blackstone RealEstate Income Trust and MGM Resorts International for Blackstone toacquire the Bellagio for $4.25 billion, leasing it back to asubsidiary of MGM Resorts for initial annual rent of $245 million.In this case, MGM Resorts received a 5% equity interest in thejoint venture.

|

Together, the MGM Grand and Mandalay Bay comprise 9,743 rooms,three million square feet of meeting space and 300,000 square feetof casino space across 226 acres on the Las Vegas Strip. MGMResorts' initial annual rent will be $292 million.

|

This transaction is expected to close in the first quarter of2020, subject to certain customary closing conditions.

Want to continue reading?
Become a Free ALM Digital Reader.

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.