A plan by Genting Malaysia Bhd (GenM) to sell 15.5 acres of prime Miami real estate has fallen through.
In a June 22 filing, GenM said the prospective buyer, Smart Miami City LLC, remains interested in the four properties, but not at the originally agreed-upon price of $1.225 billion. As reported by MSN, Smart Miami requested an extension of the exclusivity period and sought amendments to the commercial terms of the sale and purchase agreement.
“However,” the filing stated, “the purchaser’s requests were not granted at this time and hence the purchaser has elected to end its current bid. GenM has seen the value of its investment in Miami increase approximately 400 percent in just over a decade and firmly believes in the sustained strength and growth of the Miami market.
“GenM will review other opportunities to close on the sale of the Miami land as-is while the company continues to enhance its remaining Miami holdings,” the filing continued.
The previous week, GenM shareholders had overwhelmingly approved the sale, with 99 percent voting in favor.
According to Inside Asian Gaming, GenM entered into a conditional agreement with Smart Miami on April 26. The proceeds were expected to fund the expansion of GenM’s slots-only Resorts World New York City casino. The property in Queens borough is expected to win one of three full casino licenses to be granted by New York lawmakers this year. A full license would allow the addition of gaming tables.
In a note, Nomura analysts Tushar Mohata and Alpa Aggarwal called the sale a “very positive development” for the company and its parent, Genting Bhd.
“The original cost of investment in 2011 was US$259 million, and the carrying value as of now is US$255 million, implying Genting Malaysia would gain US$966 million if the planned purchase materializes,” they wrote in April.
“This is a large windfall for the company, in our view, and will help improve the balance sheet for both Genting Malaysia and Genting after years of capex, Covid-19 related slowdown and generous dividends.
“We believe the cash proceeds are likely to be retained within the company for the time being to help fund the down-state New York gaming license capex, should Genting Malaysia be successful in the bidding process. We expect the license award timeline in 1Q24.”
Genting still owns the Hilton Miami Downtown Hotel and Omni Center but had hoped to develop a large-scale integrated resort, Resorts World Miami, on the land, which includes the former headquarters of the Miami Herald newspaper on Biscayne Bay.
The Malaysian company’s plans were reportedly foiled due to the influence of the powerful Seminole Tribe, whose casinos dominate the landscape in Florida.
