Mar 3, 2021 - Economy

Las Vegas Sands' shake-up on the Strip

Tourist takes a picture of Venetian property

A tourist takes a photo of the Venetian Resort in Las Vegas. (Photo: Roger Kisby/Bloomberg via Getty Images)

Las Vegas Sands is leaving Las Vegas — and effectively, the U.S.

Why it matters: The sale of its properties hints at huge trends reshaping the gaming industry and its defacto home.

Details: Sands is selling all of its properties on the strip — including its flagship Venetian resort — in a deal worth over $6 billion.

  • The buyers: real estate giant VICI Properties and private equity firm Apollo Global Management.

All eyes on Asia: Robert Goldstein, Sands' chief executive who took over for the late Sheldon Adelson, said today its properties in Macao and Singapore are "the center of our attention," and where it's long made almost all of its money.

  • This is officially Asia Sands, Jason Ader, a former Sands board member and current CEO of blank-check firm 26 Capital, tells Axios. (The company's headquarters will remain in Vegas.)
  • Other casino operators want a bigger foothold, but licenses are hard to come by.

Future of betting is in other states: Casino operators (including Sands!) are increasingly eyeing places like New York and Texas — where sports betting could be legalized and there's less competition than saturated Vegas.

What to watch: What's next for Vegas' battered economy.

  • The sale of the biggest asset on the strip is a big shake-up for the iconic area — which has been walloped since the pandemic plunged Nevada's leisure and casino industry into crisis.
  • Sands is "taking its chips off the table and letting it ride in Asia. I don't think people should ignore the importance of that symbolically," says Ader.

Yes, but: Never bet against the house.

  • There were buyers willing to pay "pre-COVID prices for an asset, despite the fact that Vegas has been one of the slowest markets in the U.S. to recover," James Goldstein, an analyst at CreditSights, says.
  • The deal “underscores our conviction in a strong recovery for Las Vegas as vaccines usher in a reopening of leisure and travel in the United States and across the world," a partner at Apollo said in a statement.

Details: Sands' exit is an opening for private equity firm Apollo Global Management, which has a (spotty) history in the gaming sector.

  • Flashback: Apollo bought gaming giant Harrah’s Entertainment, which later became Caesars (then went bankrupt and ultimately was sold to a rival in a deal that closed last year). It bought a Canadian casino last year.
  • Apollo is buying Sands' operations. Real estate giant VICI Properties is buying the property itself (so it'll be Apollo's landlord).
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