{"id":21095,"date":"2018-02-06T08:51:59","date_gmt":"2018-02-06T16:51:59","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=21095"},"modified":"2021-01-11T06:51:20","modified_gmt":"2021-01-11T14:51:20","slug":"vici-victorious-on-the-street-macao-monopoly-threatened","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/vici-victorious-on-the-street-macao-monopoly-threatened\/","title":{"rendered":"Vici victorious on the Street; Macao monopoly threatened"},"content":{"rendered":"

MGM Resorts International<\/strong> is definitely going to have to sweeten its offer for Vici Properties<\/strong> after the latter had a hugely successful IPO, hitting $1.2 billion. Shares of the REIT were sufficiently in demand that Vici is going to enlarge the float<\/a>. As far as the MGM \"\"angle is concerned, an offer of $19.45\/share isn’t going to cut it when Vici is trading for $21, as it is. Victorious Vici CEO Ed Pitoniak<\/strong> gloated understandably and rightly:\u00a0\u201cThere is growing interest in gaming real estate as a real estate asset class worthy of institutional investment.\u201d He added, “We are fortunate to be a point where that interest is growing strongly.\u201d Gaming analyst David Katz<\/strong> laid out a scenario whereby Vici and tenant Caesars International<\/strong> could buy, say, Wynn Resorts<\/strong> by bidding for it in tandem. (Needless to say, MGM and MGM Growth Properties<\/strong> could execute the same pincer movement.) How long do you think it will be before Sheldon Adelson<\/strong> forms a REIT?<\/p>\n

So what is Vici going to do with its bankroll? $670 million will be used to pay down debt. Some of it will be squirreled away for as-yet-unforseen acquisitions. It would be congruent with Caesars’ history for Vici to pick off low-hanging regional fruit. By contrast, I am quite baffled as to what MGP would do with the plethora of small casinos it would obtain if it bought Vici. Both CEO Jim Murren<\/strong> and President William Hornbuckle<\/strong> have made it clear that MGM’s priorities were Japan<\/strong> and domestic megaresorts, in that order. What use would they have with sharecropper properties like Harrah’s Council Bluffs<\/strong>?<\/p>\n

*\u00a0Chinese officialdom is evidently so thrilled with the results of opening up Macao<\/strong> as a gambling free market that they’re thinking of repeating the experiment<\/a> in Hainan<\/strong> — at \"\"least in a limited fashion. The initial forms of gambling would sports betting, Internet<\/strong> gambling, maybe a lottery. So, rest easy, Sheldon, your megaresorts are not being threatened with Hainan competition … yet. Motivating factors are high hotel occupancy in Macao and the continued flight of Chinese capital to offshore casino destinations. Writes Bloomberg<\/em>, “By restricting the domestic supply of baccarat, blackjack and slot machines, the government is pushing gambling dollars offshore\u00a0— supporting jobs and tax revenues elsewhere in the region while encouraging tourists and junket operators to poke holes in Beijing<\/strong>‘s capital controls.”<\/p>\n

Adds the report, “The greatest threat from an expansion of mainland casinos is to regional competitors rather than Macau’s six operators.\u00a0The world’s biggest gambling destination can stand on its own two feet. Without the push from Chinese prohibition, though, Brisbane<\/strong>, Manila<\/strong> and Lao Jai<\/strong>\u00a0may see their allure rapidly disappear.” Whatever China<\/strong>‘s government decides about gambling expansion, Western entrepreneurs will be there in a flash.<\/p>\n","protected":false},"excerpt":{"rendered":"

MGM Resorts International is definitely going to have to sweeten its offer for Vici Properties after the latter had a hugely successful IPO, hitting $1.2 billion. Shares of the REIT were sufficiently in demand that Vici is going to enlarge … Continue reading →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":14883,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[103,7,22,37,62,11,38],"tags":[],"_links":{"self":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/21095"}],"collection":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/comments?post=21095"}],"version-history":[{"count":2,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/21095\/revisions"}],"predecessor-version":[{"id":29080,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/posts\/21095\/revisions\/29080"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media\/14883"}],"wp:attachment":[{"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/media?parent=21095"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/categories?post=21095"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/wp-json\/wp\/v2\/tags?post=21095"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}