Las Vegas Strip Casino 'Likely' Up for Sale This Year

The Strip saw many changes in 2022 and another big one may be coming -- but it may not be the one you think.

For much of 2022, all eyes were on Caesars Entertainment (CZR) - Get Free Report as the company openly flirted with selling one of its Las Vegas Strip properties. 

There were rumors about the company's Planet Hollywood resort casino, but ultimately it was the Flamingo being dangled in front of potential buyers.

And that sale never happened, at least partly because financing got more expensive as interest rates went up. Once the sale window passed Caesars made clear that the company was not likely to revisit the issue that year. 

Asked about credit markets during the company's fourth-quarter-earnings call, Chief Executive Tom Reeg addressed  the matter.

DON'T MISS: Caesars Misses Deadline on Las Vegas Strip Casino Sale

"We are not active in that market, so I can't speak with first-hand knowledge. I'd tell you today would have been a tough day to try to do something," he said.

The Caesars nonsale came in a year where sales of two major properties closed. 

MGM Resorts International (MGM) - Get Free Report sold the Mirage to Hard Rock International while it purchased the Cosmopolitan. 

In addition, the Fontainebleau landed funding to complete its construction on the North Strip and billionaire Tilman Fertitta acquired land on the Strip with plans to build a resort casino in the heart of the area controlled by Caesars and MGM.

Now, a key analyst has suggested that another Strip asset is about to hit the market.

Las Vegas Strip Asset Likely to Go on the Market 

Given the movement and various projects in the works on the Strip, there will always be rumors of sales. That could mean an established operating casino or a project that's being built changing hands.

"A Las Vegas Strip casino-resort is likely to hit the auction block this year and it won’t be of the venues currently operated by Caesars Entertainment," Casino.org reported, based on comments from Deutsche Bank analyst Carlo Santarelli who recently met with Caesars management.

Santarelli, in a note to clients, also implied that a Strip property would come up for bid before year-end. He also said that property wouldn't be one from Caesars. And he made clear that Caesars almost certainly won't be a bidder. That's because the company paid down $1.2 billion in debt last year and wants to do that again this year.

Which Las Vegas Strip Asset Will Be Sold?

Santarelli did not list the properties that could be put up for sale. Casino.org's Todd Shriber suggested that the real estate that MGM's Bellagio sits on could be in play.

"Here’s why that’s a possibility. Last December, Blackstone Real Estate Income Trust  (BX) - Get Free Report, which owns Bellagio’s real estate, was hit with a slew of redemption requests from investors, prompting it to sell some assets to raise capital. Those transactions include the sales of 49.9% stakes in Mandalay Bay and MGM Grand to VICI Properties (VICI) - Get Free Report or $4.27 billion," he wrote.

Santarelli's note to clients also said that the property that could be sold is an operational casino. That means the struggling Dream Las Vegas, a boutique resort casino under construction near Harry Reid airport, is not likely to change owners.

Construction at Dream Las Vegas has stopped while its owner works to line up new funding to complete the project.

"Other possibilities include MGM selling the operating rights to Excalibur and Luxor -- the latter of which has been the subject of rumors regarding its fate. However, the gaming company has not said it’s looking to trim its Las Vegas portfolio," Shriber added.