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LAS VEGAS-After much red tape, debate and ink from media coverage, MGM Mirage and Dubai World have closed on their CityCenter joint venture. The two parties have valued the project at $5.4 billion.

As part of the agreement, Dubai World has contributed $2.96 billion for 50% of the equity in the project. MGM Mirage picks up $2.47 billion in cash. In addition, the JV retained $490 million to fund any short-term construction costs.

Known as CityCenter Holdings LLC, the joint venture will own 100% of the mixed-use site, which will include luxury residential as well as a resort and retail complex. The project is already under construction and MGM Mirage will remain the developer.

“The combination of assets and expertise held by MGM Mirage and Dubai World creates opportunities that were previously unavailable to us before this association was formed,” said Terry Lanni, chairman and CEO of MGM Mirage, in a company statement. He added that the partnership at CityCenter is the “the first step in a long-term relationship” for the two entities.

The project is set for a late 2009 completion date. Architects on board include Daniel Libeskind, Lord Norman Foster and Rafael Vinoly. Specs for the so-called “city-within-a-city” include: a 4,000-room resort and casino; 470,000 sf of retail and entertainment space; 2,650 luxury condominiums and condo-hotel units in multiple towers; and two 400-room boutique hotels. One hotel will be managed by Mandarin Oriental.

As earlier reported on GlobeSt.com, Dubai World has invested $1.2 billion in MGM Mirage through the purchase of 14.5 million share of MGM Mirage common stock. That figure accounts for 4.9% of outstanding shares.

Dubai World has agreed, subject to limited exceptions, not to acquire more than 20% of the outstanding shares of MGM Mirage’s common stock. Billionaire investor Kirk Kerkorian continues to control MGM Mirage through Tracinda Corp., which owns a 56% stake.

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