Deal frenzy reshapes Las Vegas Strip
The Las Vegas Strip is on the brink of a new era — its iconic properties are getting new owners at a rate rarely seen before.
Why it matters: This year's historic number of deals on the Strip hint at huge trends reshaping the gaming industry and America's longtime gambling capital.
- "It's rare to see so many transactions this close together. We can go years without seeing a Las Vegas Strip casino change hands. It's a unique environment right now," says John DeCree of Union Gaming, an advisory firm.
By the numbers: There were seven deals that saw a casino's property or its operations snapped up this year — the most since at least 2015, per CreditSights.
What's happening: The Mirage is the latest to land a new owner: MGM Resorts this week said it would sell the hotel and casino's operations to Hard Rock International, owned by the Seminole Tribe of Florida, for about $1 billion in cash.
It's among the flurry of transactions where the Strip's most well-known players are swapping properties that have come to define Vegas.
- Take Las Vegas Sands, which after this year won't own any hotels or casinos in its namesake city. It's selling everything (including its flagship Venetian resort) to real estate giant VICI Properties and private equity firm Apollo Global Management in a deal worth over $6 billion — the year's biggest Vegas-centric transaction.
The intrigue: The changes come amid a wild frenzy for casino operators to nab gaming licenses and set up shop in other nascent betting hubs, including New York City. They're also eyeing the online betting boom.
What they're saying: "It's not like Vegas is the only place they can make money anymore. They're saying 'we can make money in different parts of the country too — and abroad,'" says James Goldstein, an analyst at CreditSights.
- Las Vegas Sands, for instance, is ditching Vegas to double down on Macao and Singapore.
Yes, but: Plenty see a lot to love in Vegas, particularly as the Strip stages an impressive comeback from its pandemic shutdown — though the latest coronavirus wave might deliver a big blow.
- Casino operator Bally’s — which is also trying to dominate online betting — will get its first-ever foothold in Las Vegas: It said this year it would buy the operations of the Tropicana casino, one of the oldest resorts on the Strip, for $150 million.
- And while MGM may be giving up The Mirage, it said in September it would buy the operations of the Cosmopolitan Las Vegas. That means that it won't technically be losing any exposure to Vegas at all, though it is "consolidating towards the south end of the Strip," says DeCree.