Posted on: November 8, 2022, 01:59h.
Last updated on: November 8, 2022, 04:44h.
Hard Rock International is slated to assume operations at the Mirage next month, taking the reins from MGM Resorts International (NYSE: MGM).
Hard Rock, the gaming arm of the Seminole Tribe of Florida, announced last December it purchased the operating rights to the venue for $1.075 billion, making it the first tribal operator with a presence on the Las Vegas Strip. The iconic volcano show is expected to remain intact for a while, and the property will shift to Hard Rock’s Unity Rewards customer loyalty platform from MGM Rewards.
Eventually, the integrated resort will bear the Hard Rock name, and it’s widely expected the venue will be refurbished in the shape of the tribal gaming company’s famed guitar. MGM is licensing the Mirage name and brand to Hard Rock for three years. That agreement is royalty-free.
Gaming real estate investment trust (REIT) VICI Properties (NYSE: VICI) is the owner of Mirage’s real estate, and Hard Rock entered into a long-term lease contract with that company.
Mirage Closure Talk
In the wake of the tribal gaming giant acquiring Mirage’s operating rights, there’s been ample discussion regarding whether or not the venue could face downtime. That’s as the new operator makes changes and enhancements.
Although Hard Rock is aiming for significant alterations and expansion of the Strip venue in 2025, it’s not immediately clear if the casino resort will be closed for parts of the interim period. Some Las Vegas experts believe the Mirage won’t be shuttered during a remodeling period. But some Wall Street analysts don’t agree.
Something else to keep an eye on is the potential for the Hard Rock Casino (former Mirage) to shut down for almost two years as they renovate the asset,” said Stifel analyst Steven Wieczynski in a recent report to clients.
The analyst said operators, such as Caesars Entertainment (NASDAQ: CZR), could benefit as Mirage’s 3,000 rooms are temporarily pulled from the market.
Tribal Presence Grows in Las Vegas
Hard Rock’s Las Vegas entry increases the presence of tribal operators in the largest domestic casino center. Mohegan Gaming & Entertainment runs the gaming operations at Virgin Hotels Las Vegas. Earlier this year, Red Rock Resorts, Inc. sold the Palms Casino Resort to the San Manuel Band of Mission Indians of California for $650 million.
However, Hard Rock has true bragging rights because Mirage is the only Strip venue of that trio. Industry observers expect tribal gaming entities will be future players for other Strip assets.
It’s a matter of what comes up for sale. Some tribes were rumored to be interested in the Flamingo. But Caesars recently said it won’t proceed with plans to divest one of its Las Vegas assets.