MGM Resorts International has completed its transaction with Blackstone to acquire the operations of The Cosmopolitan of Las Vegas casino and resort.
For a cash consideration of $1.625bn, The Cosmopolitan of Las Vegas now joins MGM Resorts’ ‘iconic’ brands along the Las Vegas Strip.
MGM Resorts entered into a 30-year lease contract, including three 10-year renewal options, with a partnership among Stonepeak, Cherng Family Trust, and Blackstone Real Estate Income Trust Inc, which acquired The Cosmopolitan’s real estate assets.
An initial annual rent of $200m will be paid by MGM Resorts, which will escalate annually at 2% for the first 15 years and the greater of 2% or the CPI increase (capped at 3%) thereafter.
“This is a big moment for our company and for the Las Vegas Strip,” commented MGM Resorts CEO and President Bill Hornbuckle.
“The Cosmopolitan of Las Vegas has already established itself as one of the Strip’s premier resorts with an iconic brand, well-curated experiences, and a loyal customer base. We couldn’t be more excited to bring them into our portfolio of world-class operations.
“We’re also thrilled to have the talented group of CoStars from The Cosmopolitan joining the MGM Resorts family. We look forward to improving upon The Cosmopolitan’s already strong results by offering their customers access to the extensive and exclusive amenities and other benefits only MGM Resorts can provide.”
The Cosmopolitan opened in December 2010 and underwent significant capital improvements following Blackstone’s 2014 acquisition of the property. It generated $1.1bn of net revenue and $416m of adjusted EBITDAR in the trailing 12 months ended March 31, 2022.
The property features 3,033 rooms and suites; a 110,000 square-foot casino with high-end gaming areas for VIP guests; 26 food and beverage offerings; a 3,200-seat theater; a nightclub and dayclub; 243,000 square feet of centrally located meeting space featuring state-of-the-art technology to accommodate both large and small groups; 36,000 square feet of leased retail space; and a 43,000 square foot spa and fitness facility.