MGM Resorts Is Making Moves on the Las Vegas Strip
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MGM Resorts has a complicated ownership structure in the Las Vegas Strip. The company owns Bellagio Hotel & Casino, New York-New York, and Park MGM, but it didn't own The Cosmopolitan and only owned half of CityCenter.
MGM Resorts has bought Cosmopolitan for $1.625 billion. The company will pay $200 million per year in rent for 30 years. Management said the price was just eight times adjusted EBITDA. Las Vegas Strip is reporting all-time record gambling revenue.
MGM Resorts is consolidating its operations on the Las Vegas Strip. The north end of the Strip is controlled by Caesars Entertainment. Owning adjacent resorts can help MGM book room blocks for conventions and other large events. It could also enable MGM Resort and its real estate partners to develop new properties.
MGM Resorts is expanding aggressively. The company needs to decide how it's going to play DraftKings' $22 billion offer to buy its 50/50 BetM MGM partner Entain. MGM could end up acquiring the half of Bet MGM it doesn't own.
