{"id":4079,"date":"2015-10-31T13:02:03","date_gmt":"2015-10-31T13:02:03","guid":{"rendered":"https:\/\/www.uspokersites.com\/poker-news\/?p=4079"},"modified":"2018-01-09T17:17:00","modified_gmt":"2018-01-09T17:17:00","slug":"mgm-resorts-creates-a-real-estate-company-named-mgm-growth-properties-llc","status":"publish","type":"post","link":"https:\/\/www.uspokersites.com\/poker-news\/mgm-resorts-creates-a-real-estate-company-named-mgm-growth-properties-llc\/4079","title":{"rendered":"MGM Resorts Creates a Real Estate Company Named “MGM Growth Properties LLC”"},"content":{"rendered":"
\"Mandalay

Mandalay Bay Is One of 10 Properties the New MGM Growth Properties LLC Will Own, along with $4 Billion in Debt.<\/p><\/div>\n

MGM Resorts plans to shift some of its casino assets to a newly-created real estate division, MGM Growth Properties LLC<\/strong><\/a>. The company released a statement saying the move is meant to “boost value for shareholders” and give the parent company and the new company more flexibility to grow.<\/p>\n

The announcement came while company executives were touting better-than-expected 3rd Quarter results. MGM Resorts’s quarterly report included a $66.4 million profit, which is a turnaround from the loss reported a year ago during 2014 Q3. In further good news, the newly-constructed Mandalay Bay Convention Center is booked already through the entirety of 2016.<\/p>\n

MGM Growth Properties<\/strong><\/h2>\n

Despite the good news, it was the launching of a new company which garnered the bulk of MGM Resorts news over the past two days. The plan is to create a “real estate investment trust” or REIT, which would own 10 of MGM Resorts’ casinos. This REIT, which will be called MGM Growth Properties LLC, would assume $4 billion of the gaming company’s debt.<\/p>\n

Jim Murren’s Press Conference<\/strong><\/h2>\n

MGM Resorts CEO Jim Murren held a conference call late last week to discuss the financial move. He said that MGM Resorts would own a substantial interest in MGM Growth Properties, estimating it would be about 70%. The new company would go public with an initial public offering in the 1st Quarter of 2016.<\/p>\n

Jim Murren told the financial media and gaming analysts on the conference call, “We’re in it together. We want to see (MGM Growth Properties) grow, and grow rapidly.<\/em>”<\/p>\n

New Company Is Not a Spinoff<\/strong><\/h2>\n

A spokeswoman for MGM Resorts, Meghan Repko, later declined to call the move a spinoff. Instead of giving shareholders stock in the new company, like a spinoff allows, MGM Growth Properties will be its own separate company. The public will be given the opportunity to buy stock, with no special consideration for the current investors.<\/p>\n

MGM Growth Properties’s Assets<\/strong><\/h2>\n

Ten properties in all are expected to be owned by MGM Growth Properties. Those include six Las Vegas-area casinos, including Mandalay Bay, New York-New York, Excalibur, Monte Carlo, The Mirage, and Luxor. The Park, a non-gaming retail outlet mall<\/strong><\/a> still under construction, is also part of the assets package. The Park is going to be located on the Las Vegas Strip between Monte Carlo and New York-New York, in a part of the Strip dominated by the MGM Resorts properties.<\/p>\n

Along with the seven Las Vegas properties, three regional casinos are going to be a part of the assets owned by the new company. Those casinos operate in Michigan and Mississippi, including the Mississippi Gold Strike Tunica<\/strong><\/a>, the Beau Rivage Biloxi, and the MGM Grand Detroit in Michigan<\/strong><\/a>.<\/p>\n

Terms of the Lease<\/strong><\/h2>\n

Under the new structure, MGM Resorts will be the renter of the properties, while MGM Growth Properties will be the landlord. The arrangement includes a long term masters lease with a 10-year term. This can be extended by MGM Resorts with a series of four 5-year leases, taking the arrangement through the year 2045. MGM Resorts would be responsible for improvements and renovations on the properties, despite being the tenant.<\/p>\n

MGM Resorts’s Remaining Assets<\/strong><\/h2>\n

Meanwhile, MGM Resorts would own several of the company’s top Las Vegas properties. This includes the MGM Grand and Bellagio casinos on the Las Vegas Strip, along with the Circus-Circus casino. It also will continue to own the Las Vegas Strip CityCenter complex, which includes a number of smaller casino-hotels and retail outlets. The Las Vegas Arena, a 20,000-seat sports and concert venue still under construction, will remain an asset of the original company.<\/p>\n

The Borgata casino-resort in Atlantic City, New Jersey also will remain under the parent company’s control. The Borgata is the most successful land-based and online casino brand in the New Jersey gaming market.<\/p>\n

Jim Murren said MGM Resorts will continue to own the MGM China operations. This includes the MGM Macau, a 50% joint venture opened in 2007 alongside Pansy Ho, daughter of China’s King of Gambling, Stanley Ho. After the IPO (and concerns by US regulaors), MGM Resorts owned 51% of the operation. Other assets still under MGM Resorts’s control are Diaoyutai MGM Hospitality (China), MGM Hakkasan (Asia, Middle East, Abu Dhabi), and MGM Mirage Vacations (Milwaukee).<\/p>\n","protected":false},"excerpt":{"rendered":"

MGM Resorts plans to shift some of its casino assets to a newly-created real estate division, MGM Growth Properties LLC. The company released a statement saying the move is meant to “boost value for shareholders” and give the parent company … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-4079","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t