Hard Rock Arrives On Las Vegas Strip in $1.07B Mirage Purchase
Posted on: December 13, 2021, 03:48h.
Last updated on: December 13, 2021, 04:44h.
Hard Rock International is doling out $1.075 billion for the operating rights to the Mirage, making it the first tribal operator on the Las Vegas Strip.
![Hard Rock](https://www.casino.org/news/wp-content/uploads/2021/12/HRI.jpg)
MGM Resorts International (NYSE:MGM) confirmed last month it was in the process of selling the gaming rights to the venue. It acquired the property in 2000 as part of a broader $4.4 billion transaction that included Bellagio, Treasure Island, several other Nevada properties, and casinos in Australia, Detroit, and Mississippi.
The real estate assets of the Mirage are owned by MGM Growth Properties (NYSE:MGP), which is being acquired by VICI Properties (NYSE:VICI). Hard Rock, the gaming arm of the Seminole Tribe, “will enter into a long-term lease agreement with VICI Properties Inc. for the real estate property of The Mirage,” according to a statement.
Financial terms of that arrangement weren’t disclosed. But MGM was paying $90 million in annual rent on the Mirage.
Hard Rock Adds to Las Vegas Tribal Vibe
Hard Rock has long been attached to rumors involving Las Vegas Strip assets, and the company hasn’t shied away from that speculation.
Prior to 2020, Hard Rock International had no previous involvement with the Hard Rock Hotel & Casino in Las Vegas. HRI purchased the licensing and naming rights for Hard Rock Hotel & Casino Las Vegas in May 2020 and vowed to bring the iconic brand to the Las Vegas Strip when the right opportunity presented itself,” the operator said in a statement.
Hard Rock’s Las Vegas entry increases the presence of tribal operators in the largest domestic casino center. Mohegan Gaming & Entertainment runs the gaming operations at Virgin Hotels Las Vegas, and earlier this year, Red Rock Resorts, Inc. (NASDAQ:RRR) sold the Palms Casino Resort to the San Manuel Band of Mission Indians of California for $650 million.
Neither the Palms nor Virgin are on the Strip, indicating Hard Rock is beating rivals to the most desirable stretch of gaming assets in the US. Hard Rock confirmed it will build a guitar-shaped hotel at the Mirage property, and that the venue will be renamed Hard Rock Las Vegas.
MGM is retaining rights to the Mirage name, licensing it to Hard Rock for three years up to the official name change. That agreement is royalty-free.
Coup for MGM, Too
The transaction is a positive for MGM, too, as it adds to the company’s burgeoning cash stockpile and exceeds some analysts’ estimates in terms of price. Previously, there was sell-side chatter that selling the Mirage gaming rights would result in proceeds of $500 million to $600 million. But after taxes and fees, MGM estimates it will clear $815 million.
The price for the Mirage operating rights was below the $2.25 billion Apollo Global Management paid for the Ventian and Sands Convention rights earlier this year. In September, MGM shelled out $1.6 billion to acquire Cosmopolitan’s operating rights from Blackstone (NYSE:BX).
In 2019, Mirage generated earnings before interest, taxes, depreciation, amortization, and restructuring or rent costs (EBITDAR) of $154 million, according to MGM.
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I ama a MGM member who is involved with a Seafood Processor from Canada. Who is the person who issues the Po 's for Snow Crab & Lobster?