According to people with knowledge of the matter, who have requested anonymity due to the private nature of the deliberations, Blackstone is open to reviewing bids for half of its interest in the real estate of the Bellagio resort. The company is still assessing its options and has not yet confirmed a sale. Representatives from Blackstone and MGM Resorts declined to provide any comments on the matter.
Blackstone purchased the Bellagio resort in Las Vegas from MGM Resorts four years ago for $4.25 billion in a sale-leaseback transaction. But now the company considers liquidating some of its real estate holdings. On Monday, Blackstone Group revealed its plans to sell some of its warehouses and industrial properties to the logistic real estate Prologis Inc. for $3.1 billion.
Despite the weakening of other real estate sectors like malls and office spaces, traffic to Las Vegas hotels has remained strong. Bellagio is one of the best-performing resorts on the Las Vegas Strip. It was owned by MGM Resorts until 2019 when the company sold the resort to Blackstone.
However, MGM Resorts retained a 5% stake in the venture and continued to manage and operate the resort. The sale of the Bellagio resort allowed MGM to pay back some of its debt. At around the same time, the company sold its Circus Circus for $825 million to an affiliate of Treasure Island Hotel and Casino owner Phil Ruffin.
MGM Resorts Has Sold Many of Its Properties in Recent Years
In 2021, Caesars Entertainment spinoff Vici Properties Inc. acquired MGM Resorts’ properties division, MGM Growth Properties, for $17.2 billion. The same year, Vici Properties took full ownership of MGM Grand and Mandalay Bay’s real estate after it reached a deal to buy Blackstone’s 49.9% stake in the properties.
In 2021, Blackstone agreed to sell the operations of The Cosmopolitan, the luxury resort on the Las Vegas Strip, to MGM Resorts International for $1.625 billion. Last December, MGM Resorts announced it closed the sale of its Mirage Hotel and Casino to Hard Rock International for $1.075 billion in cash. Last year, MGM also sold a 15-acre property on the Las Vegas Strip to the Three Affiliated Tribes of the Fort Berthold Indian Reservation.
MGM Resorts and Blackstone Group have been very active in selling their properties in recent years. It is yet to become clear why Blackstone is interested in selling half its stake in the profitable Bellagio resort in Las Vegas. Bellagio has always been one of the four resorts on the Las Vegas Strip, generating over $1 billion per year in revenue. The three other big moneymakers in Las Vegas are Wynn Las Vegas, Venetian and Palazzo, and MGM Grand.