The Federal Trade Commission took less than two weeks to sign off on Caesars Entertainment’s $516.3 million sale of the Rio resort in Las Vegas to a New York-based real estate group.
In a filing Friday, the FTC cleared the transaction, which was announced Sept. 23. A company controlled by a principal of New York-based Imperial Companies is acquiring the Rio and will lease the resort back to Caesars, will pay $45 million in annual rent under an agreement for at least two years.
“The Federal Trade Commission has determined there are no anti-trust issues with the Rio sale,” a spokeswoman for Caesars said in an email.
Caesars hopes to close the sale of the Rio by the end of the year, pending shareholder and regulatory approval.
Imperial Companies, led by founding partners Eric Birnbaum and Michael Fascitelli, is a real estate investment, development and management platform focused primarily on mixed-use, residential, and hospitality businesses throughout the U.S. According to its website, the firm launched in 2014 and has spent “approximately $1 billion of total capitalization across its various investments.”
According to September filing with the Securities and Exchange Commission by Caesars, the lease provides the landlord with a one-time renewal option for an extension of up to 12 months. The landlord will need to exercise the renewal option “or before the end of the first year of the initial term.”
Caesars is in the process of being merged with Eldorado Resorts in a $17.3 billion deal that will create a gaming conglomerate with 60 properties in 19 states under multiple brands, including Caesars, Harrah’s, Eldorado, Horseshoe and Bally’s. The transaction is expected to close next year.
The Rio opened in January 1990 as a Brazil-themed resort. The property has 2,522 rooms. Caesars’ predecessor Harrah’s Entertainment acquired the Rio in 1998 for $880 million in stock and assumed debt.
Since 2004, the Rio has been home to the World Series of Poker, which runs for seven weeks from late May to the middle of July. This year’s tournament drew a record 187,298 entries. The World Series of Poker is credited with boosting the Rio’s visitation.
#theFLASH – FTC signs off on sale of the Rio resort to New York real estate group. –@howardstutz, CDC Gaming. https://t.co/gy4QlSQpXA #CDCgaming @RioVegas
— CDC Gaming (@CDCNewswire) October 8, 2019
The tournament will remain at the Rio next year but may depart – possible to the under-construction $375 million Caesars Forum, a 550,000-square-foot conference and events center, being constructed behind the Linq on the Strip.
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
