Realty Income Corp. has announced its plans to invest a significant sum of $950 million as part of its acquisition of a 22% stake in the renowned Bellagio Las Vegas. This stake is currently held by Blackstone Real Estate Income Trust Inc. (BREIT), a subsidiary of Blackstone Inc.

Investment Breakdown

Out of the total investment, Realty Income has agreed to allocate approximately $300 million in common equity to acquire a 22% indirect interest in the property. Meanwhile, BREIT will maintain a significant 73.1% indirect interest, while MGM Resorts International will retain a 5% interest in the property.

Additionally, Realty Income will also invest an impressive $650 million to secure a yield-bearing preferred equity interest in a joint venture with BREIT for the ownership of the Bellagio.

Increased Valuation

This recent deal has significantly raised the valuation of the Bellagio, now standing at $5.1 billion. This value surge is notable considering that Realty Income acquired the property from MGM Resorts International back in 2019 for $4.25 billion in a sale-leaseback agreement.

Sign of Recovery and Rebound

This transaction serves as an optimistic indication of the travel industry's gradual recovery and the resurging popularity of Las Vegas as a top destination over the past three years. It demonstrates renewed confidence and investment interest in the region.

Successful Performance

Blackstone's stock has seen a remarkable increase of 33.5% in 2023, outperforming the S&P 500, which has grown by 14%.

  • Realty Income Corp. - Press Release
  • Wall Street Journal Report

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