LAS VEGAS – The Tropicana Las Vegas Hotel and Casino, a Sin City namesake, is being sold to a new entrant among Las Vegas Boulevard resort owners.
Rhode Island-based Bally’s Corp. announced Tuesday it will acquire the iconic Strip property from Gaming and Leisure Properties Inc. for about $308 million.
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The agreement for the nearly 1,500-room hotel, casino, theater and convention property also involves a sale-and-leaseback transaction relating to Bally’s Black Hawk, Colorado and Rock Island, Illinois, casino properties, the company said.
“Landing a preeminent spot on the Las Vegas Strip is a key step for us,” George Papanier, Bally’s president and CEO, said in a statement.
Bally's Corp. does not own Bally’s Las Vegas on the Strip. That 2,800-room property at Flamingo Road is owned and operated by Caesars Entertainment Inc.
Papanier noted that Las Vegas draws more than 40 million tourists a year and said owning the Tropicana will boost Bally’s customer and player databases, unlock marketing opportunities and benefit Bally’s online and interactive business.
Bally's also announced a deal to combine with London-based online gaming operator Gamesys Group plc.
Neil Goulden, Gamesys chairman, said in a statement the recommended cash offer, including a Gamesys fiscal 2020 dividend, provides a 41.2% premium to the Gamesys share price at the time of the original proposal from Bally’s. Gamesys shareholders can elect to convert holdings to Bally’s shares.
The Bally’s-Tropicana transaction is expected to close early next year. The company said the price for Tropicana property non-land assets was $150 million, and Bally’s plans to lease the land underlying the Tropicana property from Gaming and Leisure Properties for an initial term of 50 years at $10.5 million in annual rent.
The sale-and-leaseback transaction relating to Bally’s Black Hawk and Rock Island has Gaming and Leisure Properties paying $150 million and an initial annual fixed rent of $12 million.
Bally’s owns and manages 12 casinos in eight states, including Bally's Atlantic City in New Jersey, and said it is set to own and manage 15 casinos in 11 states after several acquisitions are completed.
The Tropicana Atlantic City is owned by Caesars Entertainment.
Bally’s is already licensed as a casino operator in Nevada. It purchased the MontBleu Resort near Lake Tahoe from Caesars earlier this month.
The Tropicana Las Vegas opened in April 1957. It has two towers of 22 and 21 stories on a 35-acre (14-hectare) parcel at a Las Vegas Boulevard intersection with a major thoroughfare named for it. The hotel has been operated in recent years as a DoubleTree by Hilton.
When it opened with three stories and 300 rooms in 1957 at a cost of $15 million, it was described as the most expensive hotel-casino built in Las Vegas and dubbed the “Tiffany of the Strip.”
The Flamingo had been open for a decade, the Sahara for almost 15 years. The high-rise Stardust opened the following year, costing $8.5 million.
“It was seen as a cut above other places and a little more intimate,” said David Schwartz, a gambling historian and former director of the Center for Gaming Research at the University of Nevada, Las Vegas. “It’s one of the most storied properties still open today.”
Historian Michael Green said organized crime often had a hand in Tropicana operations, but observed that today it is corporate-owned.
“The Trop has a checkered history and a checkered past. But it also had a significant non-mob phase," Green said.
It was home for nearly 50 years to the “Les Folies Bergere” — a glittery and feathery topless revue featuring quintessential Vegas showgirls until it closed in 2009.
Sammy Davis Jr. played at the Tropicana, Schwartz said. Green noted Eddie Fischer was the opening-night headliner and said lion-and tiger-taming illusionists Siegfried & Roy got their Las Vegas start at the venue before ending up at The Mirage.
Today, the site at the south end of the Strip is surrounded by megaresorts: the MGM Grand, Excalibur, New York-New York, Luxor and Mandalay Bay. It has traded hands in recent decades, seen as a site with potential for growth.
“With the development around it, it has always been seen as a place you could do something bigger,” Schwartz said.
The property was purchased by Penn National Gaming in 2015 for $360 million, and Penn last year sold the land occupied by the Tropicana to its spin-off company, Gaming and Leisure Properties, for $337.5 million in rent credits.