Las Vegas Sands Sells Las Vegas Assets for $6.3B

Las Vegas Sands Corp. has entered into two agreements to sell its real estate and operations portfolio in Las Vegas. The transactions are valued at a total of $6.25 billion and include The Venetian Resort Las Vegas and the Sands Expo and Convention Center. The sale is expected to close in the fourth quarter, and it marks Las Vegas Sands exit from the market.

Affiliates of Apollo Global Management and VICI Properties Inc. purchased the assets in two separate transactions. The affiliates of Apollo Global Management will acquire a portion of the portfolio for $1.05 billion in cash, and it will provide $1.2 billion in seller financing. VICI Properties Inc. will acquire real estate and real estate-related assets for $4 billion in cash. Goldman Sachs & Co. LLC served as exclusive financial advisor to Las Vegas Sands, and Skadden, Arps, Slate, Meagher & Flom LLP served as legal advisor.

VICI plans to form a lease with Apollo for the Venetian, which will have a total annual rent of $250 million and an initial term of 30 years, with two 10-year tenant renewal options, according to industry sources. Sands also note that, despite the pandemic and decline in activity, ongoing projects will help to generate future opportunity. This includes the MSG Sphere development, a live performance venue being developed by Madison Square Garden, which will create new growth opportunities for the properties.

In selling this portfolio, Las Vegas Sands turns its attention to Macao and Singapore, calling Asia and its Asian developments the “backbone” of the company. “We will always look for ways to reinvest in our properties and those communities,” Robert Goldstein, CEO and chairman of Las Vegas Sands, said in a statement about the transaction, adding that there are also opportunities outside of Asia that the company is pursuing. “There are also potential development opportunities domestically, where we believe significant capital investment will provide a substantial benefit to those jurisdictions while also producing very strong returns for the company,” he says.

Sands posted a $300 million loss in the fourth quarter, a result of the struggling hotel industry. Many industry experts expect Asian hotel markets to rebound quickly. China specifically is poised for a rapid recovery, according to a recent post in Preqin from John McCourt and Ryan McAndrew of RSM US LLP. They predict that hotel occupancy will rebound to pre-pandemic levels as early as next year in the Chinese market due to strict protocols.