VICI Properties Inc. Enters Into Agreements Relating to the Mirage Hotel & Casino in Las Vegas
NEW YORK, NY – VICI Properties Inc. (“VICI Properties” or “VICI” or the “Company”) announced today that, in connection with MGM Resorts International’s (“MGM Resorts”) agreement to sell the operations of The Mirage Hotel & Casino (the “Mirage”), located in Las Vegas, NV, to Hard Rock International (“Hard Rock”), VICI has agreed to enter into a new separate lease with Hard Rock related to the operations of the Mirage (the “Mirage Lease”) and also enter into an amendment to the Master Lease to be made by and between VICI Properties and MGM Resorts (the “MGM Master Lease”).
The transaction:
- Further expands VICI’s existing partnership with Hard Rock as they acquire the operations of The Mirage in Las Vegas
- Provides VICI the opportunity to potentially invest up to $1.5 billion in the redevelopment of The Mirage, and
- Diversifies VICI’s Las Vegas tenant roster to four tenant relationships, upon closing of all pending transactions.
John Payne, President and Chief Operating Officer of VICI Properties said, “We are thrilled to continue to help our tenants achieve mutually beneficial objectives. By working collaboratively with MGM Resorts to sell the Mirage operations we are able to grow our pre-existing partnership with Hard Rock as they expand their gaming operations onto the Las Vegas strip, the most economically productive street in America.”
The lease between VICI Properties and Hard Rock related to the operations of the Mirage will have initial annual base rent of $90 million with other economic terms substantially the same as the MGM Master Lease, including a base term of 25-years with three 10-year tenant renewal options, escalation of 2.0% per annum (with escalation of the greater of 2.0% and CPI, capped at 3.0%, beginning in lease year 11) and minimum capital expenditure requirements of 1.0% of annual net revenue.
Additionally, subject to certain conditions, VICI Properties may fund an up to $1.5 billion redevelopment plan of the Mirage through VICI’s Partner Property Growth Fund. Specific terms of the redevelopment and related funding remain under discussion and subject to final documentation between VICI and Hard Rock.
VICI Properties has also agreed, in accordance with, and as contemplated by, the terms of the MGM Master Lease, to amend the MGM Master Lease to account for MGM’s divestiture of the operations of the Mirage, which will result in a reduction of the initial annual base rent under the MGM Master Lease by $90 million.
The transactions referenced herein are expected to be completed in the second half of 2022 and are subject to customary closing conditions, regulatory approvals and the closing of VICI’s previously announced pending acquisition of MGP. VICI’s acquisition of MGP is expected to close in the first half of 2022.
About VICI Properties Inc.
VICI Properties Inc. is an S&P 500® experiential real estate investment trust that owns one of the largest portfolios of market-leading gaming, hospitality and entertainment destinations, including Caesars Palace Las Vegas, MGM Grand and the Venetian Resort Las Vegas, three of the most iconic entertainment facilities on the Las Vegas Strip. VICI Properties' national, geographically diverse portfolio consists of 43 gaming facilities comprising over 122 million square feet and features approximately 58,700 hotel rooms and more than 450 restaurants, bars, nightclubs and sportsbooks. Its properties are leased to industry leading gaming and hospitality operators, including Caesars Entertainment, Inc., Century Casinos, Inc., the Eastern Band of Cherokee Indians, Hard Rock International Inc., JACK Entertainment LLC, MGM Resorts International, Penn Entertainment, Inc., and The Venetian Las Vegas. The Company has a growing array of investing and financing partnerships with leading non-gaming experiential operators, including Great Wolf Resorts, Cabot, Canyon Ranch and Chelsea Piers. VICI Properties also owns four championship golf courses and 34 acres of undeveloped and underdeveloped land adjacent to the Las Vegas Strip. VICI Properties' strategy is to create the nation's highest quality and most productive experiential real estate portfolio. For additional information, please visit www.viciproperties.com.
