From the desks of the Hotel News Now editorial staff:
- MGM Resorts to sell MGM Grand Las Vegas real estate
- Accor reaches 3,000th hotel in Europe
- UK bans credit-card use in casinos, betting shops
- Hilton San Jose sold for almost $120 million
- Hutchinson announced as Rotana CEO
MGM Resorts to sell MGM Grand Las Vegas real estate: MGM Resorts International announced it has entered into a definitive agreement to sell the MGM Grand Las Vegas real estate assets to a joint venture of MGM Growth Properties and Blackstone Real Estate Income Trust for $2.5 billion, according to a news release. MGP owns 50.1% of the joint venture while BREIT owns 49.9%. The joint venture will also acquire the real estate assets for Mandalay Bay Resort and Casino, which is currently owned by MGP.
As part of the transaction, MGM Resorts will receive net cash proceeds of $2.4 billion and about $85 million in MGP operating partnership units, the release states. MGP also entered into an agreement to deliver cash up to $1.4 billion of MGM Resorts’ existing operating partnership units. The joint venture will lease both MGM Grand and Mandalay Bay to MGM Resorts for an initial rent of $292 million.
“These announcements represent a key milestone in executing the company's previously communicated asset-light strategy, one that enables a best-in-class balance sheet and strong free cash flow generation to provide MGM Resorts with meaningful strategic flexibility to create continued value for our shareholders,” said Jim Murren, chairman and CEO of MGM Resorts, in the release.
Accor reaches 3,000th hotel in Europe: Accor, without naming the specific property, announced it has opened its 3,000th hotel in Europe. At the same time, the French hotel group said it will debut the Mondrian brand (since June 2018, Accor owns 50% of Mondrian’s owner SBE) in Europe with a hotel in Cannes, France, due to open in 2021, according to a news release.
A second Mondrian hotel for Europe, a 97-room asset in Bordeaux, France, also is due to open in 2021. Mondrian did previously have a hotel in Europe, the Mondrian London, but management transferred to independent Lore Group in January 2019, when the hotel was officially renamed Sea Containers London.
Brands to continue global march through 2025: In the second instalment of Hotel News Now’s “2025 Hotel Trends Report” on predictions for the next half a decade, HNN’s Danielle Hess writes that industry experts expect performance of hotel brands to continue to be strong.
Jan Freitag, SVP of lodging insights at STR, the parent company of HNN, said “the brand trend is going to continue, and is happening globally.”
Derek Olsen, SVP at hotel consultancy CHMWarnick, added that “soft-branded lifestyle hotels will remain front and center over the next five to 10 years, a development driven by millennials with growing incomes.”
Hilton San Jose sold for almost $120 million: Hotel consultancy JLL announced that the 353-room Hilton San Jose, California, has been sold for $117.55 million to an undisclosed buyer, reports newspaper The Mercury News.
The seller, China’s Han’s Holdings Group, bought the property in 2017 for $87.3 million, according to the newspaper. The 18-story hotel connects directly via sky bridge to the San Jose McEnery Convention Center in the Bay Area city’s downtown.
Hutchinson announced as Rotana CEO: United Arab Emirates’ based Rotana Hotels has announced Guy Hutchinson as its new president and CEO, according to a news release. Hutchinson has been the firm’s acting CEO since January 2019 and prior to that served as COO, starting in January 2014.
In 2019, Rotana debuted in Baghdad, Iraq; Casablanca, Morocco; Dar es Salaam, Tanzania; and Sarajevo, the capital of Bosnia and Herzegovina. It has six brands, including Rotana, Arjaan and Centro.
Compiled by Terence Baker.
*Correction, 14 January 2020: This story has been updated to clarify property ownership and the value of a transaction.