NEW YORK – (BUSINESS WIRE) – Jan. September 2021–
Blackstone (NYSE: BX) announced today that Blackstone Real Estate Partners VII LP (“BREP”) has entered into an agreement to sell The Cosmopolitan of Las Vegas (“The Cosmopolitan”) for $ 5.65 billion.
Since taking over The Cosmopolitan in 2014, Blackstone and a world-class management team have made the resort the premier travel destination on the Las Vegas Strip. Blackstone made significant operational changes, investing over $ 500 million in the property to renovate nearly 3,000 guest rooms, build 67 new rooms and suites, improve food and drink options, and dramatically improve game facilities and common areas. Blackstone has also reached agreements with unions on the property, securing approximately 3,000 permanent jobs for professionals who will continue to serve guests at the hotel. As a result of these improvements, the Cosmopolitan’s recent performance was stronger than ever, beating pre-COVID levels in the second quarter of 2021.
Tyler Henritze, Head of Acquisitions Americas at Blackstone Real Estate, said, “This transaction underscores Blackstone’s ability to acquire and convert large, complex assets. As the owners of The Cosmopolitan, we have invested strategic capital and brought our lodging expertise and experience to create the most dynamic travel destination on the Las Vegas Strip. The Cosmopolitan management team and staff, led by CEO Bill McBeath, executed an ambitious business plan flawlessly, including tackling an industry-challenging time to position the property so successfully. “
Transaction details
BREP went through a thorough process of considering a wide range of potential options for The Cosmopolitan and determined that separating the asset’s activities from the underlying property would produce an optimal outcome.
Under the terms of the agreement, MGM Resorts International intends to take over the operations of The Cosmopolitan and to sign a long-term net rental agreement with a partnership between Cherng Family Trust, Stonepeak Partners and Blackstone Real Estate Income Trust, Inc. (“BREIT”), which will own the property from The Cosmopolitan.
“Stonepeak believes this transaction, in partnership with the Cherng Family Trust, represents a fantastic opportunity to invest in the underlying real estate of The Cosmopolitan of Las Vegas, a solid asset with an irreplaceable location, sustained cash flows and the potential for additional Upside potential. “Said Phill Solomond, Head of Real Estate at Stonepeak.
The transaction is expected to close in early 2022, subject to regulatory approvals and other customary closing conditions.
Deutsche Bank Securities Inc. and PJT Partners acted as financial advisor to BREP. Simpson Thacher & Bartlett LLP acted as legal advisor to BREP.
Latham & Watkins LLP served as legal advisor to the Cherng Family Trust and Stonepeak Partners.
About Blackstone Real Estate
Blackstone is a leading global real estate investment company. Blackstone’s real estate business was founded in 1991 and has invested capital of $ 208 billion. Blackstone is the world’s largest commercial property owner, owning and operating assets in all major regions and sectors including logistics, apartment buildings, offices, hospitality and retail. Our opportunistic funds seek to acquire under-managed, well-located assets around the world. Blackstone’s Core + strategy includes open-ended funds investing in essentially stabilized real estate investments worldwide and Blackstone Real Estate Income Trust, Inc. (BREIT), a privately held REIT that invests in US income generating assets. Blackstone Real Estate also operates one of the leading global real estate lending companies, providing comprehensive financing solutions for the full capital structure and risk spectrum, including managing the Blackstone Mortgage Trust (NYSE: BXMT).
About Cherng Family Trust
Founded in 2005, the Cherng Family Trust is a dynamic single family office organization responsible for the administration, finance, investing and charitable initiatives of Andrew & Peggy Cherng and their family. With a team of employees, the Cherng Family Trust seeks to promote the development and growth of its family members, employees, investment partners, as well as the local communities with which it is involved.
About Stonepeak
Stonepeak is a leading alternative investment firm specializing in infrastructure and real estate with approximately $ 39 billion in assets under management. By investing in defensive hard asset companies worldwide, Stonepeak aims to create value for its investors and portfolio companies and to have a positive impact on the communities in which it operates. The company offers capital, operational support and committed partnerships to sustainably increase investment in its target sectors, including transportation and logistics, communications, water, energy transition, power and renewables, and real estate. Stonepeak is headquartered in New York with offices in Houston, Austin and Hong Kong. More information is available at www.stonepeakpartners.com.
View source version on businesswire.com: https://www.businesswire.com/news/home/20210927005433/en/
CONTACT: Media:
Black stone
Jeffrey Kauth
(212) 583-5395
Jeffrey.Kauth@Blackstone.com
Stone peaks
Kate Beers
(646) 540-5225
beers@stonepeakpartners.com
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SOURCE: Blackstone
Copyright Business Wire 2021.
PUB: 09/27/2021 08:15 AM / DISC: 09/27/2021 08:16 AM
http://www.businesswire.com/news/home/20210927005433/en
Copyright Business Wire 2021.
