Hard Rock International Agrees to Buy MGM’s Mirage Hotel in Las Vegas

The first Las Vegas strip megaresort may be under new ownership soon. Officials announced earlier this week that Hard Rock International has reached an agreement with MGM to buy the iconic Mirage Hotel. Sources have said that the deal is worth almost $1.1 billion.

Before the sale becomes official, it is subject to regulatory approvals and must pass standing closing conditions. It is not expected to be finalized until late 2022. The details of the sale were released in a press release earlier this week.

Originally opened on November 22, 1989, the Mirage Hotel is credited with changing the landscape of the Las Vegas strip. It was built during a time that Las Vegas casinos needed a new way to compete with growing lottery and tribal casinos in other states. At the time it was built, the Mirage was the largest hotel resort in the world with 3,044 rooms. It was also one of the first hotels to focus on non-gambling attractions to lure in guests.

Why did MGM Sell the Mirage Hotel?

The Mirage Hotel has been a staple on the Las Vegas strip for over three decades. Unfortunately, it is located on the northern end of the strip. Experts believe that MGM has been looking to consolidate its properties to the central and southern parts of the strip. MGM previously sold its other northern properties as it moves to an “asset-light” business model. Treasure Island was sold in 2009 and Circus Circus was sold in late 2019.

Selling the Mirage Hotel and its other properties have not been the only move made by MGM. They have also announced plans to purchase The Cosmopolitan of Las Vegas, which is located in the southern part of the Vegas strip.

Officials from MGM have said that selling the Mirage Hotel will allow them to focus more on improving their other Las Vegas properties. Having fewer properties to manage will allow for a renewed focus on an improved customer experience. As MGM adopts a quality over quantity approach, it became necessary to part with the legendary hotel.

What are Hard Rock’s Plans for the Mirage Hotel?

If the sale goes as planned, Hard Rock International will once again own a stake in the Las Vegas strip. Hard Rock previously operated a hotel on the strip, but it was sold to Richard Branson in 2018.

Hard Rock International has previously discussed plans for building a 1,000-room guitar-shaped hotel on the Las Vegas strip. The Seminole Tribe, who owns Hard Rock International, already has one guitar-shaped hotel in its home state of Florida. There have also been discussions of plans to build similar guitar-shaped hotels in Nashville, Mexico City, Japan, and Barcelona. It is unknown at this time if that would mean tearing down the Mirage Hotel or building a hotel altogether.

In the short term, the hotel resort will continue to operate under the Mirage name. MGM has agreed to license the brand to Hard Rock International for up to three years royalty-free. The ability to license the Mirage brand is important in keeping the hotel open and operating. Hard Rock must obtain a Nevada Casino license, which could take up to a year.

Officials from Hard Rock International also announced that they intend to keep all 3,500 employees that currently work at the Mirage Hotel. Hard Rock Chairman Jim Allen has also stated that they will enter into a long-term lease agreement with VICI Properties Inc., a real estate investment trust.

Conclusion

An agreement has been reached between MGM and Hard Rock International to sell the iconic Mirage Hotel. MGM first opened the hotel in the late 80s and changed the landscape of the Las Vegas strip forever. Now, for the hefty price of $1.1 billion, the Mirage Hotel will likely be under new ownership by this time next year. The sale must be approved by regulatory bodies and pass certain closing conditions before it is finalized.

What Hard Rock plans to do with the storied hotel is unknown. Officials have said they will wait to decide the fate of the Mirage until Hard Rock obtains a Nevada gaming license. In the meantime, the hotel will remain open and operate under a licensing deal between MGM and Hard Rock International. Officials from Hard Rock have also stated that they intend to keep all 3,500 of the Mirage employees on their payroll.