The Nevada Gaming Commission has approved actions that will allow MGM Resorts to buy out its CityCenter partner, Dubai World, giving MGM full ownership of the Las Vegas Strip property. The $2.1 billion transaction was expected to close almost immediately on commissioners’ unanimous approval.
Dubai World initially contributed $5 billion to CityCenter, a 16.8 million-square-foot resort complex on 76 acres. It includes Aria, the 1,500-room Vdara, the 392-room Waldorf Astoria with 225 condominium units, the 674-unit Veer Towers condominium complex, and the 500,000-square-foot Crystals retail mall. CityCenter opened in December 2009.
According to the Las Vegas Review-Journal, Dubai World is directly owned by the United Arab Emirates; the approval of the partnership marked the first licensing of a foreign nation in the state.
MGM plans to establish two separate property companies for the 4,000-room Aria and the nongaming Vdara hotel. Then both properties will be sold to New York’s Blackstone Group for $3.89 billion; Blackstone will lease the properties back to MGM for $215 million a year.
The plan is part of MGM’s “assets-light” strategy, launched in 2016 to maximize revenue through leasing and managing resorts with real estate investment trusts.
When the transaction is completed, all properties operated by MGM in Las Vegas will belong either to Blackstone or MGM Growth Properties, a real estate investment trust directly affiliated with the company.
