72°F
weather icon Clear

Commission OKs MGM bid to buy out CityCenter from partner

Updated September 24, 2021 - 7:05 am

A big Strip buyout and a disciplinary action against a small tavern whose staff and patrons wouldn’t wear masks marked the end of John Moran Jr.’s record 14-year run on the Nevada Gaming Commission.

During the chairman’s final meeting Thursday, Moran accepted praise and shoutouts from fellow regulators, attorneys who have appeared before him and his son, also an attorney.

Commissioner Ogonna Brown arranged for a massive chocolate cake adorned with symbols of his chairmanship on three different state commissions. A state flag flown over the Capitol in Carson City on Thursday will be presented to Moran in the future by Gaming Control Board members and staff.

But before the party, there was business to conduct.

The commission approved actions that will enable MGM Resorts International to buy out the partner that helped build CityCenter, Dubai World.

Commissioners unanimously approved the $2.1 billion transaction that will give Dubai World’s 50 percent stake in CityCenter to MGM. Dubai World initially contributed $5 billion in the partnership. With the regulatory approval, the deal is expected to close within days.

CityCenter is a 16.8 million-square-foot complex on 76 acres that includes Aria, the 1,500-room Vdara, the 392-room Waldorf Astoria with 225 condominium units, the 674-unit Veer Towers condominium complex, and the 500,000-square-foot Crystals retail mall. CityCenter opened Dec. 16, 2009.

Initial approval of the Dubai World partnership was significant because the company is directly owned by the United Arab Emirates and the approval marked the first licensing of a foreign nation.

Changing hands

MGM isn’t expected to hold onto CityCenter for long.

In MGM’s appearance before the Nevada Gaming Control Board on Sept. 8, company officials outlined plans to establish two separate property companies for the 4,000-room Aria and the nongaming Vdara hotel.

Once that is completed, both properties would be sold to The Blackstone Group of New York for $3.89 billion and it would lease the properties back to MGM for $215 million a year.

It’s all part of MGM’s “assets light” strategy that was initiated five years ago to maximize revenue through leasing and managing resorts with real estate investment trusts.

When the transaction is completed, all properties operated by MGM in Las Vegas will belong either to The Blackstone Group or MGM Growth Properties, a real estate investment trust directly affiliated with the company.

Nationwide, only one property is owned directly by MGM, its hotel-casino in Springfield, Massachusetts.

Tavern owner settles

Commissioners also unanimously approved a settlement with the owner of a Carson City tavern that ultimately will enable her to surrender her gaming license and pay a $10,000 fine.

The Control Board issued a complaint Aug. 9 against Bette Larsen, owner of The Timbers in Carson City.

According to the 18-page complaint, a Control Board agent inspected The Timbers on the evening of May 5. During the inspection, he saw 20 to 30 patrons inside the bar not wearing face coverings or practicing social distancing. The agent also saw three employees behind a bar not wearing masks.

The incident occurred at a time when Gov. Steve Sisolak had issued an emergency resolution requiring facial coverings.

Carson City attorney Chris MacKenzie represented Larsen at Thursday’s commission hearing and said she agreed to the stipulation of settlement.

Under the settlement terms, Larsen will be required to pay a $10,000 fine and surrender her license by Jan. 31. The surrender of the license can be extended administratively to July 30 as she seeks a new owner. In the meantime, she will be required to file an application within two months to license a key employee — someone with direct oversight of the tavern that would answer to regulators — that must successfully complete a regulatory compliance seminar within three months of accepting the job.

The fine was twice the amount of a fine ordered by the commission in November when The Timbers faced similar allegations from the board.

Honoring chairman’s service

Throughout Thursday’s meeting, attorneys appearing before the commission thanked Moran for his service on the regulatory body, culminating with an appearance by his son, John T. Moran III, who recounted his father’s service on the Colorado River Commission and the Nevada Board of Wildlife Commissioners as well as the Gaming Commission.

Moran, 74, retired from the board to make way for new leaders. His son said that one of the first things his father was going to do was make a wager on the Las Vegas Raiders’ upcoming game because before, as a commissioner, he was not allowed to gamble.

Contact Richard N. Velotta at rvelotta@reviewjournal.com or 702-477-3893. Follow @RickVelotta on Twitter.

Don't miss the big stories. Like us on Facebook.
THE LATEST