LAS VEGAS (KLAS) — Caesars Entertainment has agreed to sell the Rio All-Suite & Casino to a New York based real estate firm. The deal was announced Monday morning.
Imperial Companies will buy the Rio for $516 million and Caesars will lease the property back for $45 million per year for at least the next two years. After that, Caesars has an option to continue operating the property or transition the Rio over to Imperial.
“After that who knows: They may bring in a new manager; they may explore their options,” said David Schwartz, gaming historian at UNLV. “If there was a change of operators, it would change a lot.”
Caesars told investors the deal will allow the company to focus more resources on it’s properties on the Las Vegas Strip.
“This deal allows Caesars Entertainment to focus our resources on strengthening our attractive portfolio of recently renovated Strip properties and is expected to result in incremental EBITDA at those properties,” said Tony Rodio, CEO of Caesars Entertainment. “The retention of the World Series of Poker and retention of Caesars Rewards customers are all factors that make this a valuable transaction for Caesars.”
However, experts say the change in ownership wont make a huge difference.
“From a day to day standpoint, you won’t see any change in the operations at all,” Schwartz said.
Schwartz said the recent sale of properties is part of a larger trend in Las Vegas.
“We’ve definitely seen a lot more of this happening. I think this also signals that assets in Las Vegas are in play, and we’ve heard rumors about Circus Circus, so who knows what’s going to be next,” according to Schwartz.
As far as the rumors that the Rio property could be turned into a major league baseball stadium goes, Schwartz says he doesn’t believe them. Especially now, due to the kind of firm Imperial Companies is.
“They like to buy assets, develop them, manage them, so I wouldn’t see them buying this, having someone else manage it, and then building a baseball stadium. But you never know,” Schwartz reiterated.
The Rio sale is expected to close by the end of this year.