Investment firm Blackstone Inc. is reportedly exploring offers for half of its stake in the real estate of the renowned Bellagio Hotel and Casino in Las Vegas.
Blackstone Eyes Partial Divestment of Bellagio Stake in Real Estate Portfolio Shake-up
The Bellagio property was acquired by Blackstone in 2019 for a staggering $4.25 billion in a sale-leaseback transaction with MGM Resorts International. Under the agreement, Blackstone Real Estate Income Trust (BREIT) and MGM Resorts formed a joint venture, with BREIT holding a 95% stake and MGM Resorts holding a 5% stake. As part of the deal, MGM Resorts would continue to lease and operate the Bellagio while being responsible for all day-to-day operations and capital expenditures.
Blackstone’s decision to potentially sell 50% of its stake in the Bellagio casino comes as the firm seeks to capitalize on its real estate assets, Bloomberg reported. The company recently announced plans to divest warehouses and industrial properties for $3.1 billion to Prologis Inc., further indicating its strategy of cashing out on certain real estate positions.
Blackstone has a history of divesting its interests in Las Vegas properties. In 2021, the firm sold the renowned Cosmopolitan hotel, and in December 2022, it agreed to sell its 50% stake in the MGM Grand and Mandalay Bay resorts to Vici Properties Inc., its partner at the time. These transactions highlight Blackstone’s ongoing efforts to optimize its real estate portfolio.
Speculation Surrounds Potential Sale of Bellagio Stake as Blackstone Weighs Options
The Bellagio, located on the iconic Las Vegas Strip, is one of the city’s top-performing resorts. Despite challenges faced by other real estate sectors such as malls and office spaces, the hotel has maintained strong visitor traffic, contributing to its reputation as a premier asset in the gaming industry.
Both Blackstone and MGM Resorts have declined to comment on the matter, leaving room for further anticipation and speculation within the market. While the sale of the Bellagio stake remains under consideration, industry experts are speculating on the potential value of the property and the companies that may submit bids for its acquisition. Blackstone’s deep history and expertise in the Las Vegas real estate market, across various asset classes including office, hospitality, and residential, make it an influential player in the industry.
Notably, Blackstone has made headlines in recent years as the majority owner of Crown Resorts, an Australian-based gambling company. Last year, the investment giant acquired Crown Resorts for an impressive $6 billion, further solidifying its presence in the global hospitality and entertainment sector. The deal came amid a series of regulatory inquiries into Crown’s operations, which resulted in the company losing its license to operate a new casino in Sydney and facing potential revocation of its licenses in Melbourne and Perth. Blackstone proposed several conditions for the deal, including regulatory approval, access to Crown’s financial records, and retention of key personnel.
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