Las Vegas Strip casino for sale
Gaming and Leisure Properties is looking to offload the Tropicana Las Vegas on the south end of the Las Vegas Strip. The 35-acre hotel and casino is up for sale with no asking price. The listing comes at a time when Sin City is struggling to come back from closures due to the COVID-19 pandemic.
scheduled to reopen on September 1
The pandemic has devastated the economy of Las Vegas. Casinos shut down in March to try to slow the spread of COVID-19, but many properties remain closed in Southern Nevada, even after they were permitted to reopen on June 4. The Tropicana casino one of those that is still closed, but is scheduled to reopen on September 1.
Staying patient
The current owner of the Tropicana Casino is looking to sell the casino outright or sell and rent it back. Michael Parks of the CBRE Group’s global gaming unit is the listing broker for the property. According to Mr. Parks, there is currently no asking price, though Gaming and Leisure figures it can get at least what Penn National paid for the property five years ago: $360m.
We’re just waiting to see how things shake out in the world.”
Mr. Parks has yet to complete extensive outreach in search of a potential buyer, telling the Las Vegas Review-Journal, “We’re just waiting to see how things shake out in the world.”
In April, after the pandemic began, Penn National Gaming sold the Tropicana to Gaming and Leisure Properties for $307.5m. Payment for the property was made via rental credits. Penn National Gaming, a real estate investment trust spun-off from Penn National in 2013, will operate the facility for two years based or until the facility is sold.
If the Tropicana is sold by Gaming and Leisure Properties within that two-year time frame, Penn National could receive as much as 75% of the net sale.
Demand remains
Chad Beynon, a casino analyst from the Macquarie Group, pointed out that despite the current pandemic, demand remains for properties in Las Vegas. Gaming and Leisure Properties can explore potential buyers for now, he said, but he believes that it could garner a higher price if the sale took place in a few years.
It is expected that Gaming and Leisure Properties will address the sale status of the Tropicana after releasing its second-quarter earnings report later this week.