“Las Vegas has very few global rivals” confidently proclaimed Edward Pitoniak, CEO of Vici Properties, who predicted that investments into the Nevadan city are something of a no brainer.
Among the numerous M&A manoeuvres undertaken by the real-estate investment trust is an enlarged footprint on the famous street, amid consistent vows to “opportunistically pursue transactions” to maintain the group’s growth journey.
In glancing back over a year that has delivered many developments, before detailing the opportunities that lie ahead, Pitoniak offered an assessment of the past 12 months.
“Vici has grown nearly five-fold since our emergence only five years, so every year has been transformative, but 2022 has been our most transformative year yet,” he noted.
“In 2022 we became real estate owners of The Venetian, the largest gaming and hospitality asset in America, and of MGM’s MGP portfolio.
“We now own 10 assets on the most economically productive street in the world, The Las Vegas Strip, the best regional gaming portfolio in America, and new 2022 partnerships with great experiential brands like Cabot and Canyon Ranch. We were elevated to investment grade as a credit and we entered the S&P 500 faster than any other REIT in history.”
“Las Vegas has very few global rivals”
In addition to a pair of recent collaborations alongside Century Casinos, the REIT, as aforementioned, recently strengthened its presence on the Silver State’s crown jewel.
This saw the group acquire the remaining 49.9 per cent interest of a joint venture that owns MGM Grand Las Vegas and Mandalay Bay Resort from Blackstone.
It was detailed that the purchase of Blackstone’s share of the JV would be for $1.27bn and Vici’s assumption of the pro-rata share of the existing property-level debt.
Pitoniak continued: “This brings us full ownership of two of the biggest and best assets on the Las Vegas Strip – MGM Grand and Mandalay Bay – and puts us in an enhanced position to be of service to our partner, MGM Resorts, in capitalising on the growing strength of the south end of the Strip, thanks to the galvanising power of Allegiant Stadium and T Mobile Arena as crowd-gathering attractions. These are two great assets that both have opportunities to grow.”
Maintaining this same path, CasinoBeats quizzed the Vici CEO on what prospects are still possessed by a region that recently saw an uptick as state-wide casinos exceeded $1bn in revenue for the 20th straight month.
“Las Vegas has very few global rivals for the scale and quality of its tourism and gathering-place infrastructure,” it was commented.
“You can expect us to continue to look for opportunities to put our capital behind great place-makers and experience-creators”
“The air lift to Las Vegas recovered to pre-pandemic levels faster than anywhere else on earth. While many urban tourism and convention centres have seen reduced investment and secular challenges, Las Vegas has continued to invest in existing properties, develop new attractions and become even more of a global entertainment epicentre.
“Entertainers like Adele and Lady Gaga do their residences in Las Vegas for a reason! (Those residences are in our assets, by the way).”
Throughout 2022, Vici and Pitoniak have consistently stressed a desire to pursue further transactions to continue the group’s growth journey, and as we hurtle towards the end of the year that certainly seems to be the case for the next 12 months and beyond.
“You can expect us to continue to look for opportunities to put our capital behind great place-makers and experience-creators like MGM, Caesars and Hard Rock in gaming, and Cabot and Canyon Ranch outside of gaming,” Pitoniak commented.
“We are the best performing REIT in the S&P 500 in 2022; our total return of approximately 15 per cent year to date outpaces the S&P 500 by nearly 30 percentage points.
“We have access to capital that puts us in a great position to be a capital partner to companies in gaming and non-gaming that [have] compelling opportunities to grow.
“The world will watch and it will see, clearly, that there’s no place like Las Vegas”
“We’d love to eventually invest in Reno, the Las Vegas locals market, the Las Vegas Downtown markets. We are also intent on investing internationally, in gaming and non-gaming.”
To conclude, Las Vegas again became the centre of attention as the issue of what wider industry trends we should be looking out for during 2023.
“The post-COVID urge to gather will not wane quickly and America’s gaming assets are unrivalled places to gather,” he stated.
“The event calendar in Las Vegas in 2023 is, not to put too fine a point on it, insane. And then we get the Super Bowl in early 2024. Las Vegas will be the busiest place on earth in 2023.
“We’re particularly excited about the global exposure that Las Vegas will generate by hosting its first F1 race, right on the legendary Strip. The world will watch and it will see, clearly, that there’s no place like Las Vegas.”
