Content With ‘Exposure’ In Las Vegas, MGM Resorts Has Begun Process Of Selling The Mirage

This week, during the earnings call of MGM Resorts International, Bill Hornbuckle, the CEO, announced that The Mirage will be put up for sale by the company. Hornbuckle stated:

I previously stated that we are satisfied with our current exposure level in Las Vegas. Therefore, we are at the preliminary phase of a process to divest the operations of the Mirage.

It’s important to clarify that MGM Resorts does not own the land. Rather, it is owned by MGM Growth Properties. Furthermore, the real estate segment of MGM has been sold to VICI. The transaction will be finalized next year, transferring land ownership to VICI.

MGM Resorts will be selling only the operations at The Mirage, potentially altering the type of buyer who might be interested in the property.

Hornbuckle did not disclose any possible buyers the company might be in discussions with. Any new owner of The Mirage’s operations will likely introduce a new sportsbook operator to the Vegas Strip.

Why MGM Resorts is selling The Mirage

Hornbuckle discussed the sale of The Mirage rather than other Las Vegas properties during the call. The answer seems to be pretty straightforward.

The Mirage has long been regarded as one of MGM Resorts’ top assets. The company’s recent acquisition of operations at The Cosmopolitan enables it to essentially exchange one luxury property for another.

The composition of MGM Resorts’ properties will remain unchanged even after the completion of both sales. It will continue to offer accommodations in all price brackets for its clientele.

• Aria, Bellagio, The Cosmopolitan are top tier.
• Excalibur, Luxor, Mandalay Bay, MGM Grand, New York-New York, and Park MGM are among the mid and lower tiers.

This variety enables MGM Resorts to market to visitors of all budget sizes. It also facilitates the company in maintaining its properties nearest to T-Mobile Arena and Allegiant Stadium, essential venues for selling hotel rooms and attracting more BetMGM customers.

Who are the contenders to buy The Mirage?

Over the past year, there has been considerable conversation about new sportsbook operators arriving in Nevada. Registering an in-person sports betting account continues to be a challenge, but The Mirage is a desirable location for several reasons.

Firstly, The Mirage boasts one of the largest retail sportsbooks on the Vegas Strip, making it highly appealing to retail sportsbook operators. Secondly, The Mirage’s central strip location is ideal, provided that in-person registration for sports betting accounts is mandatory.

Numerous potential buyers for a Las Vegas casino have been speculated in recent years. Here are four casino and sportsbook operators who may be contemplating the purchase of The Mirage’s operations:

Hard Rock International

Jim Allen, CEO of Hard Rock International, has been discussing the possibility of opening a Hard Rock property in Las Vegas for some time. The company has acquired complete intellectual property rights to use the name Hard Rock Las Vegas Hotel and Casino.

A Hard Rock Casino is eventually slated to open in Las Vegas. It appears the company would also prefer to own the associated real estate, although this deal may not be suitable for them.

Golden Nugget (and DraftKings)

Tilman Fertitta, the owner of Golden Nugget, contemplated acquiring Caesars Entertainment in 2019. It’s plausible that Fertitta may shift his focus to The Mirage, potentially bringing DraftKings on board as his sportsbook partner. Should this transpire, The Mirage would host the inaugural DraftKings Sportsbook on the Vegas Strip.

DraftKings could potentially purchase the casino outright. MGM Resorts might favor cash transactions over the predominantly stock-based deals that DraftKings has recently been conducting.

Penn National Gaming (and Barstool)

This year, Penn National Gaming (PNG) divested its operations of Tropicana to Bally’s, consequently losing its presence on the Vegas Strip. Nonetheless, the company has shown interest in making a comeback to Las Vegas. PNG had earlier placed a bid on The Cosmopolitan. In a recent earnings call, its CEO, Jay Snowden expressed willingness to either purchase or operate a casino on the Vegas Strip.

Before Tropicana was sold, PNG stated that it would only establish a Barstool Sportsbook in Las Vegas if it is located on the Vegas Strip. The Mirage provides an intriguing sportsbook layout, with the California Pizza Kitchen situated above it. This has the potential to transform into a Barstool Sportsbook, accompanied by a retail One Bite Pizza outlet or an additional Barstool Sports Bar.

Boyd Gaming (and FanDuel)

Currently, Boyd Gaming does not operate a casino on the Vegas Strip. However, rumors suggest that the company may be interested in purchasing a property on Las Vegas Boulevard. Acquiring The Mirage’s operations could provide a fantastic opportunity for the company to bring its sports betting partner, FanDuel Sportsbook, into the Las Vegas market.

Boyd Gaming is the owner of the real estate for its various properties. Yet, The Mirage presents an enticing chance for the company to establish a presence on the Vegas Strip for the first time since 2013 when it sold the land which formerly housed the Stardust.