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Melanie Porter January 12, 2024 3 min read
MGM Purchased Small Parcel of Land on The Strip Last Spring
According to Clark County property records, MGM bought a small parcel of land located between the Bellagio and The Cosmopolitan for $54 million last May
MGM Resorts Land Holdings purchased a small piece of land measuring only 1.62 acres (0.0065 square km) south of the iconic Bellagio fountains on May 15, 2023.
During the same month, MGM Resorts’ LeoVegas announced it would acquire Push Gaming in an attempt to give its global development a push.
The Space Is Currently a Parking Lot
The long and slender piece of land between Bellagio and The Cosmopolitan, both operated by MGM, stretches some hundred feet. At the moment, the vacant lot serves the purpose of a parking lot as well as a storage space for garbage.
The Strip is not visible from MGM’s new piece of land because of the existing trees at the location.
In the past, the small strip of land was under the ownership of Steve Wynn, the real estate developer and art collector responsible for creating some of Sin City’s most popular casinos, including Treasure Island, The Mirage, Wynn Las Vegas, and Bellagio.
Almost two and a half decades ago, Wynn, who, according to Forbes, has a $3.4 billion real-time net worth as of January 12, 2024, sold The Mirage, Bellagio, and Treasure Island to MGM.
The latter inherited Wynn’s rights to the 1.62 acres it bought last spring. MGM has not yet expressed its plans regarding the small strip of land.
Why Is the Purchase Important for MGM?
For starters, the casino giant does not own a lot of real estate underneath the gaming venues that it owns. This is mostly because NYSE-listed VICI is the owner of most of the land under casino hotels operated by MGM.
Secondly, the large number of stakeholders involved in the ownership of the real estate belonging to Cosmopolitan and Bellagio makes the land purchase even more interesting.
Five years ago, in 2019, MGM decided to sell Bellagio’s property assets to NYSE-listed Blackstone’s Blackstone Real Estate Income Trust (BREIT) in 2019.
Last summer, in August, the same Trust announced it had sold a 21.9% stake in the respective property to NYSE-listed Realty Income in exchange for $950 million.
In September 2021, Blackstone announced the sale of Cosmopolitan for $5.65 billion. Next, BREIT, Stonepeak Partners, and the Cherng Family Trust acquired the real estate of the respective integrated companies for $4 billion.
Blackstone is also the owner of Aria and Vdara’s property assets. The two are operated by MGM.
Given the very limited size of the space, MGM is less likely to build a new integrated resort there or adjoin Bellagio and Cosmopolitan given the existing walkway reuniting the two properties via an escalator.
One possibility would be for MGM to sell the land to one of the previously mentioned entities that hold interests in the real estate associated with Cosmopolitan and Bellagio.