Change coming to the Strip
A giant guitar is set to dominate the future skyline of the Vegas Strip after MGM Resorts International announced it will sell the operations of The Mirage Hotel & Casino to Hard Rock International for $1.08bn in cash.
Las Vegas Review-Journal gaming reporter Howard Stutz took to Twitter on Monday to share Hard Rock’s music-inspired intentions for The Mirage’s Las Vegas Strip location:
Hard Rock and real estate investment trust VICI Properties have reached a long-term lease agreement. The pair are discussing a $1.5bn redevelopment plan for the current Mirage-occupied real estate. VICI will take up the role of landlord once its takeover of MGM Growth Properties closes.
Under the terms of the deal, MGM Resorts will maintain its rights to The Mirage name and brand, which it will license royalty-free to Hard Rock for up to three years.
A fond farewell
In a Monday press release, MGM Resorts CEO Bill Hornbuckle described the deal as a “significant milestone” for his firm and Las Vegas as a whole.
Hornbuckle helped open the casino-hotel in 1989, spending the formative years of his career there. The CEO said he had firsthand knowledge of “how special” The Mirage is, and the “great opportunity” it offers Hard Rock. He also thanked the casino-hotel’s staff, who he said have “consistently delivered world-class gaming and entertainment experiences to our guests” for more than 30 years.
MGM put The Mirage up for sale in November, as part of its asset-light strategy. Chair of the MGM board Paul Salem said The Mirage deal will give the Las Vegas-based casino operator “significant financial resources to pursue our strategic objectives.”
will position the Company with a fortress balance sheet.”
Salem has affirmed that the monetization of MGM Resorts’ entire real estate portfolio, along with its $2.13bn dollar purchase of CityCenter and acquisition of The Cosmopolitan of Las Vegas “will position the Company with a fortress balance sheet.”
MGM eyes rosy future
At the closing of the Hard Rock transaction expected H2 2022, an amendment to MGM Resorts’ master lease, which includes The Mirage property, will trim the annual rent by $90m. MGM Resorts said it expects net cash proceeds after taxes and estimated fees to reach approximately $815m.
MGM Resorts CFO and treasurer Jonathan Halkyard said The Mirage sale has given his brand the opportunity to “re-prioritize future capital expenditures,” which he believes will ultimately boost the customer experience at its other Vegas locations.
The Hard Rock deal is a “fantastic outcome” for MGM Resorts, Halkyard affirmed.