Could Tropicana Be The Next Property Sold In Vegas?
The year 2019 was pretty exciting for the state of Nevada and the Entertainment Capital of the World, especially because many properties changed hands, with many of them being located on the Strip. The trend of big operators selling their Vegas properties is not new, but it seems that the intensity of that has increased recently.
Two companies that own several properties and are looking to let go of some are MGM International Resorts and Caesars Entertainment.
One of the reasons why MGM is looking to sell some of its properties is because it wants to shift its focus elsewhere, with Asia being the main focus for the company.
On the other hand, Caesars is looking forward to selling some of its properties because of its merger with Eldorado Resorts. The merger will make it difficult for the company to manage so many properties at once, and that’s why they want to sell some of them.
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According to analysts, the property shuffling will be even more present in 2020, and one of the properties that is most likely to be sold soon is Tropicana Las Vegas. In other words, Penn National is definitely up to something, and that could be selling Tropicana to an interested buyer.
According to Vital Vegas, which has been very accurate at predicting possible sales, the Tropicana sale is about to happen really soon. Penn National already received several bids from potential buyers in 2019, but Penn wasn’t ready to proceed with the sale back then.
Offer It Can’t Refuse
However, as Vital Vegas reports, one bid really stood out from the crowd and caught the attention of Penn National. In fact, that bid was accepted right away, and it seems that the sale is currently underway.
The bid that Penn National received that really gained its attention offered a total of $700 million for buying the property. If you take into account that Penn paid a total of $360 million when it acquired Tropicana five years ago, it’s safe to assume that it is going to make a nice profit from its investment.
This offer is significant for Penn, which currently has a huge debt that is approximately around $11 billion.
Because of all that, this deal is of a very sensitive nature, which means that Penn National will not reveal anything about it for now. In fact, the company will probably also refuse to confirm whether something is happening with the deal or not.
Journalists at Casino.org tried to reach out, but only received a response from the company’s SVP for Public Affairs, Eric Schippers, that they were not able to make any comments or speculations regarding the market.
The reason why Penn was offered so much money for its property is that the year 2020 is predicted by many analysts to be even bigger when it comes to activity in Sin City. According to Frank Schreck, an attorney who specializes in gaming in Vegas, the improvement started in 2017, and 2019 was “back to the 2007” level.
He added for the Las Vegas Business Press that he was more optimistic for 2020 compared to his optimism about the last three years.
Schreck is not the only person to be so positive about the upcoming year. In fact, Michael Lawton, senior research analyst for the Nevada Gaming Control Board, also predicted that the year-on-year increase for 2020 would be approximately one to 1.5 percent.
Once these figures are converted to dollars, it’s a lot of money in the game. It’s up to us to wait and see whether their predictions prove to be true.