Realty Income is set to invest USD 800 million in CityCenter Las Vegas, covering ARIA Resort & Casino and Vdara Hotel & Spa, while Blackstone Real Estate retains full common equity and MGM Resorts International continues operations. This follows Realty Income's earlier USD 950 million investment in Bellagio Las Vegas. The deal provides an initial 7.4% return, increasing from year five, and an 8.3% return on preferred equity redemption. The investment reinforces Realty Income's partnership with Blackstone and its growing focus on high-value hospitality assets. The transaction is scheduled to close on December 9.
Realty Income O.N has announced it will invest USD 800 million in perpetual preferred equity for CityCenter Las Vegas, which includes the ARIA Resort & Casino and Vdara Hotel & Spa. These properties are currently owned by funds linked to Blackstone Real Estate. Blackstone will continue to hold 100% of the common equity, and MGM Resorts International will keep operating the properties.
This marks Realty Income's second collaboration with Blackstone Real Estate after its USD 950 million investment in Bellagio Las Vegas in 2023. The company will also have a right of first offer if Blackstone decides to sell common equity interests in the future. Realty Income's CEO, Sumit Roy, stated that the investment strengthens their strategic partnership with Blackstone and involves one of the Las Vegas Strip's landmark properties.
The ARIA and Vdara properties sit at the heart of the Las Vegas Strip, featuring around 5,500 rooms and 500,000 square feet of convention space. The investment is structured to provide an initial return of 7.4%, which is set to increase starting from year five. Additionally, the redemption of the preferred equity will yield an 8.3% return. Realty Income also raised its 2025 investment volume target to over USD 6.0 billion.
The transaction is expected to close on December 9. This deal reflects Realty Income's ongoing interest in high-profile hospitality assets and its strategic approach to expanding in major U.S. markets.
Source Reuters
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