March 25, 2020 Casino, Land-Based

Banks left with billions' worth of debt due to MGM Grand and Mandalay Bay deals


Lenders have been saddled with billions of dollars worth of debt due to the MGM Grand and Mandalay Bay property deals in Las Vegas, according to Bloomberg.

A joint venture of MGM Growth Properties and Blackstone Real Estate Income Trust used $3bn of financing to purchase the casinos' real estate in February.

However, Citigroup, Deutsche Bank, Barclays and Societe Generale had planned to syndicate $1.9bn of the total as commercial mortgage-backed securities.

Due to the coronavirus pandemic’s impact on casinos, though, the banks’ ability to syndicate the loan has been impeded.

Because of low demand, the banks’ CMBS plans were put on hold, leaving them with the debt for the foreseeable future.

Bloomberg also reports banks involved in Eldorado Resorts’ $17.3bn acquisition of Caesars Entertainment face an “uphill battle” offloading associated debt to investors due to the long-term implications of the coronavirus pandemic.

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