The MGM Grand and Mandalay Bay casinos of MGM Resorts International are sold for $ 4.6 billion in an agreement involving private equity giant Blackstone Group.
A new joint venture between Blackstone Real Estate Income Trust and MGM Growth Properties will buy the eye-catching Las Vegas Strip complexes, which have more than 9,700 hotel rooms and about 300,000 square feet of casino space combined, the companies said.
MGM Resorts currently owns MGM Grand property, while MGM Growth Properties owns Mandalay Bay real estate, according to a press release.
The joint venture will lease the properties to MGM Resorts, which will continue to operate and manage them, which means that nothing should change day by day for players and guests. The annual rental of the properties will start at $ 292 million, according to MGM Growth Properties.
MGM Growth Properties, a real estate investment trust largely owned by MGM Resorts, will own 50.1 percent of the joint venture, while the Blackstone real estate trust will have a 49.9 percent stake. The Blackstone trust will also buy $ 150 million worth of shares in MGM Growth Properties, according to the press release. The agreement is expected to close in the first quarter of this year.
MGM Resorts CEO Jim Murren said that sales are part of the company's "asset light" strategy, which has seen her sell other casinos in recent years. Blackstone bought MGM's Bellagio casino for $ 4.25 billion last year.
"This transaction reflects our strong conviction in Las Vegas," said Jon Gray, president and chief operating officer of Blackstone, in a statement.