Home Cash: On line casino Operators Are Promoting Their Properties to Wager on Progress

Aria Resort & Casino, owned by CityCenter, is slated to be owned by Blackstone Real Estate.

Courtesy MGM Resorts International

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Casino operators continue to sell their properties as their focus is on operating, not owning, real estate.

The latest example:

MGM Resorts International

(Ticker: MGM) said earlier this month that it would pay $ 2.1 billion for the remaining 50% stake in CityCenter on the Las Vegas Strip that it does not own so that it can then sell it.

CityCenter, which MGM Resorts has managed and is part of with Infinity World Development Corp. The Aria Resort & Casino and the Vdara Hotel & Spa owned 50% of the shares.

After the deal is finalized, MGM resorts will plans to sell these properties to fund-managed Blackstone Real Estate for $ 3.9 billion. MGM will continue to operate these properties.

More businesses of this type are likely, in part because they allow companies like MGM Resorts to raise capital to invest in projects aimed at greater growth.

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In a recent notice, real estate research firm Green Street wrote that “There are other assets in Las Vegas that operators could monetize at attractive prices in a post-Covid environment”.

Cedrik Lachance, director of REIT research at Green Street, recently told Barron’s that the pricing of the deal reflects the growing premium being placed on Las Vegas real estate. The city has benefited from an increase in leisure travel this year after a difficult 2020 due to Covid. Hotel occupancy was particularly high on the weekend.

Blackstone plans to acquire the two CityCenter properties for $ 3.9 billion, or 18.1 times the initial annual rent of $ 215 million MGM will pay. In other words, the reciprocal of this ratio – or the cap rate as it is known – is about 5.5%.

In contrast, if

Las Vegas Sands

(LVS) announced in March that it was the Venetian and other properties

VICI properties

(VICI) for $ 4 billion, the cap rate was around 6.25%, according to Lachance. In other words, the rental price for the latest deal is higher than Las Vegas Sands earlier this year. That undoubtedly reflects how much more uncertain things were for the city at the time regarding the Covid situation.

Still, according to Lachance, “the gambling business is very cheap for us, both public and private” – the public market is REITs.

Outsourcing real estate is not new to casino operators as they increasingly prefer an asset-light model in which they operate but do not own real estate.

MGM growth properties

(MGP), for example, was chosen as a path for

MGM Resorts International

Discharge real estate. In May it is Companies announced that it plans to sell the resort’s Springfield, Massachusetts property

MGM growth properties

for $ 400 million – the latest in a series of sales it made.

MGM Resorts International has the largest number of hotel rooms in the world Stripes.

Stocks of MGP Growth Properties, which are returning 5.6%, are up about 22% including dividends through July 14 this year, up from about 17% for the S&P 500. MGM Resorts International’s stock has gone down slightly better developed with a plus of about 27%.

VICI properties

owns, among other things, Caesars Palace on the Las Vegas Strip. VICI stock, with a yield of 4.2%, is down about 25% this year through July 14th.

Write to Lawrence C. Strauss at lawrence.strauss@barrons.com

Restaurant, leisure venue operators have fun finish of COVID-19 occupancy limits | Coronavirus

Minutes after the newscast, John Adams’s cell phone rang about ten times.

When he picked up lunch, he quickly learned that Governor Tom Wolf was ordering the end of all COVID-19 occupancy restrictions on restaurants, bars, entertainment venues, stadiums and other places where people gather, starting May 31.

Reactions to Tuesday’s announcement ranged from cautious optimism to delight for venue owners and operators who struggled to survive the pandemic over the past year. Friends and colleagues hummed to Adams, the President of the Scranton / Wilkes-Barre RailRiders for 16 months, who still didn’t see the team play at PNC Field.

“Of course we are very optimistic. And the announcement … I think there was a mini-party being held here, “said Adams. “We’re just cautiously optimistic at this point, just because we have to wait for final confirmation from Major League Baseball.”

Adams said the team has planned a maximum of 3,000 fans this year for pod-seating and social distancing games that will be played for the 12 home games later this month. After that, the stadium can approach its usual capacity of 10,000.

Even then, he said, the team will keep pod seating for baseball scouts and players, as well as buffer areas around the shelter and bullpens, which could restrict seating. The team will also continue to enforce social distancing at entrances and concession lines, as well as in the goods store, and prevent fans from clustering during punch training or other pregame events. Fans could exit and re-enter the ballpark during rain delays to avoid overcrowding, he said.

The governor said mask wear will remain required until at least 70% of Pennsylvanians 18 and over have been vaccinated against the virus. The state follows the guidelines of the Federal Centers for Disease Control and Prevention, which allow fully vaccinated people to do without masks outdoors when they are not among the crowds, and indoors, among others already vaccinated. A health ministry spokeswoman said businesses should continue to promote social distancing.

John Cardoni, the still-dismissed general manager at the Scranton Cultural Center in the Masonic Temple, welcomed the “absolutely wonderful” news.

“You only have so much left in your reserves after a year of trying to get through and then facing an fall or winter season where you might have 5% sales,” Cardoni said. “So this is big news all round.”

Weddings and other personal events are a big part of the center’s business, he said. The center has booked a wedding in late June and a wedding or two in July, Cardoni said.

“I would expect our director’s phone to explode for special events when the news got around,” he said.

He predicted that theater groups, musical performers, and other entertainers would be launching tours in droves, which could be a boon to this and other centers.

“Everyone, from late-night show hosts with empty theaters to rock bands and local bands, everyone really wants to get out,” Cardoni said. “I hope the expectations and fees are reasonable.”

Steve Masterson, owner of Stage West in West Scranton, said his bar and concert hall were mostly closed and thrilled until the weekends. “

“I feel like everyone is ready for this,” said Masterson. “The few times we have had on Stage West Musik have been a great response. So I hope it stays that way for the rest of 2021. “

Other venues are preparing for shows.

FM Kirby announced Tuesday that comedian and podcast host Theo Von will perform at the center on October 9 at 7 p.m. during his live stand-up tour. The previously announced center for television personality, writer, and food network star Alton Brown will be visiting on February 25th next year at 7:30 p.m. Another announcement will come next week, said Anne Rodella, artistic director of the Kirby Center.

“Today’s announcement from the governor means more announcements and more shows,” Rodella said.

Will Beekman, general manager of Mohegan Sun Arena in Wilkes-Barre Twp., Said he couldn’t exaggerate how difficult the past 14 months have been for venues, agents, promoters and artists, but he said, “We are ready to meet everyone to do that behind us. “

“We have so many great acts holding dates in the second half of this year and now we can work on making them a reality,” said Beekman. “We all worked together to weather the storm and now we can do what we love to do again.”

Beekman said the news is great not only for Mohegan Sun Arena, but restaurants, hotels, and other businesses as well.

“We’re back,” he said. “And we’re ready to get started right away.”

Joshua Mast, co-owner of Posh at the Scranton Club, is one of the cautiously optimistic. The pandemic has hurt business so badly that he likely won’t know for sure if Posh will survive until next April. May is one of the busiest times with graduation ceremonies and first communion gatherings.

“The main part of our business is private events. These are slowly coming back, ”said Mast. “Nevertheless, the number of guests at these events is much lower than in the past. Even last weekend was first communion day. We usually have about 10 events on the day of First Communion. We had four events this year. So it’s better than last year when we didn’t have one. “

Scranton Mayor Paige Gebhardt Cognetti said the announcement “seems like a dream, doesn’t it?” She called it “a great relief,” but said she feared the announcement would put vaccinations off.

“The message is still that not only do we have to keep wearing masks, we still have to get the vaccine,” said Cognetti. “And since we’ve seen a drop in vaccine intake in the past few weeks, we want to make sure people are still learning about the vaccine and encourage their family, friends and neighbors to get it.”

All Pennsylvanians 16 years and older can be vaccinated.

To date, 53% of Pennsylvanians 16 and over have had at least one vaccination. This is based on numbers available on the state and Philadelphia health department websites. Lackawanna County is 62.9%; Alfalfa, 52%; Monroe, 43.6%; Pike, 40.9%; Susquehanna, 36.1%; Wayne, 48.3%; and Wyoming 49.6%.

Percentages for Pennsylvanians 18 years of age and older could not be determined.

The state health department reported 3,133 more cases on Tuesday, for a total of 1,161,619 cases and 58 new deaths, bringing the total to 26,334.

The region added 230 new cases and four deaths, bringing the total cases to 74,604 and the death toll to 1,794.

By district:

Lackawanna 44 cases added for a total of 17,853, of which 2,770 likely. Two new deaths brought the total to 460.

alfalfa 83 cases added for a total of 30,610, including 2,398 likely, and remained at 794 deaths.

Monroe added 56 cases for a total of 14,094, including 418 likely, and stayed at 300 deaths.

pike added 17 cases for a total of 3,794, including 388 likely, and stayed at 54 deaths.

Susquehanna added 10 cases for a total of 2,479, including 300 likely, and stayed at 60 deaths.

Wayne 13 cases added for a total of 3,923, with 400 likely. A new death brought the total to 78.

Wyoming seven cases added for a total of 1,851, of which 326 are likely. A new death brought the total to 48.

Denise Allabaugh and Steve Mocarsky, staff, contributed to this report.