MGM Growth, Blackstone To Buy Las Vegas Real Estate Of MGM Grand & Mandalay Bay

(RTTNews) - MGM Growth Properties LLC (MGP) and Blackstone Real Estate Income Trust, Inc. or "BREIT" agreed to form a new joint venture to acquire the Las Vegas real estate assets of the MGM Grand and Mandalay Bay for $4.6 billion. MGP will own 50.1% of the joint venture, and BREIT will own 49.9%.

In addition, BREIT will purchase $150 million in MGP Class A shares.

It is expected to close the transaction in the first quarter of 2020.

Meanwhile, MGM Resorts International (MGM) will enter into a long-term triple net master lease for both properties and provide a full corporate guarantee of rent payments.

MGM Resorts will continue to manage, operate and be responsible for all aspects of the properties on a day-to-day basis, with the joint venture owning the properties and receiving rent payments.

The MGM Grand and Mandalay Bay comprise 9,743 rooms, about three million square feet of meeting space and approximately 300,000 square feet of casino space across 226 acres on the Las Vegas Strip. MGM Resorts' initial annual rent will be $292 million.

MGP currently owns the Mandalay Bay real estate, and MGM Resorts currently owns the MGM Grand real estate.