Rumor: Circus Circus sold?

Gaughan sold Coast Casino's, which BC was part of, to Boyd, who then traded it to Ceasars for the Echelon property. Gaughan retained stocks, which Boyd then bought out by giving him then South Coast, now South Point.

 

Just welcoming you to the DARK SIDE.....

 

With the Blackstone announcement earlier in the week, I wouldn’t be surprised if this deal never happens.....the lease back cash knocks off a huge chunk of their debt. Unless, the money is right for the whole CC deal. Why else would they delay an announcement?

It’s a valuable piece of property that they can afford to keep. If they ever need it.....

How much money for the property? I would estimate that it would be worth in the neighbourhood of $1.4 to $1.6 billion. It has to generate $35 to $40 million collectively. That’s a return of 2.5 to 3 percent. Not a big number but that’s to the low side. If they keep the land and the North strip ever picks up....they still have a position....

Why else wouldn’t they announce one of Vegas’ worst kept secrets????

 

They make us overpay so why not them.

 

I wonder if Slots O Fun is included in sale. My guess it is.

TomTWI

 

Maybe they just have not come to full terms yet? Awaiting some more financials, or still negotiating various terms? Or need approval from another party? Or signoff on some loans or something?

Just a wild ass guess.

 

Or, the whole thing could be bovine doodoo!

 

Even once parties have reached general commercial agreement, it still can take a really long time to work out all the details and get an agreement signed. They could have signed a term sheet a week ago, and it could be a month before an actual purchase agreement is signed.

 

Phil Ruffin

https://www.bloomberg.com/news/articles/2019-09-20/mgm-said-in-talks-to-sell-circus-circus-to-trump-partner-ruffin

 

The Bloomberg article talks about Ruffin "fixing up the TI." I haven't been in TI much at all, probably since Wynn sold it back in 2000, but was curious about what he's actually done to the TI. Adding Gilley's? The CVS and Senor Frogs? I get the sense from reading VMB posts that TI does have low-roller (compared to the rest of the Strip) table game options, so there's that.

Just wondering how much I should get excited about Ruffin purchasing CC. I know the proximity to the convention center expansion raises intrigue as to the future of the property, but other than that...…………..

 

I think it is a play for the future. Lots of land / acreage, so if the North Strip does pop in the coming few years, he bought low with prime real estate for future development. Although, I don't know if Ruffin has ever developed something from the ground up ( casino wise). I think he is more of a bargain buyer.

 

Ruffin buying TI for $700m, which was below replacement build cost, was a steal. A nice casino that was not downtrodden, good prime location across from the Wynn / connected to Mirage, good 3.5-4 star value for the mid-level gambler.

 

I wouldn't say he's "fixed it up" but I'd also say it wasn't in bad shape when he took it over. It's not like he bought the Imperial Palace in 2008.

 

You mean it's not like he bought CC in 2019.

 

THAT is a textbook click-bait headline from Bloomberg.

 

Well if the deal really did encompass the 102 acres mentioned earlier in this thread even a billion would be less than $10 million per acre. That's about what Wynn paid for the old Frontier site and others have paid much more than that per acre in the past.

I would sorta expect that the value of the casino/hotel as an ongoing concern wouldn't even be a factor in the deal. I don't see anyone buying Circus Circus with the intent of just continuing to operate it. The land is worth more than the operations of the hotel which is probably why MGM would be interested in selling it in the first place. I get the impression they don't have the financial means or at least financial priorities to re-develop it therefore why continue to make a mere $43 million in operating income on a property they could sell for $1 billion and generate greater returns elsewhere with that money.

Here's another crazy thought. The 102 acres in question is enough land and strip frontage to subdivide into two maybe even three full size resorts. If this deal really does go through, I bet you see that property get split up with two or more projects being built on them. I'm not saying they'd all be hotel casinos, I'm just saying it's hard to imagine all that land being devoted to a single project. As an extreme example, it looks like Cosmo is on only about 11 acres and that includes the Jockey Club. Whoever is buying the Circus Circus may only intend to keep a portion of the land long term and treat the rest as an investment with the intent to sell it off later as things on that portion of the strip improve.

 

I spoke with my Mgm limo driver he told me circus circus has buyer lined up for sure (he didn’t know who it was for sure) but one of biggest reason Mgm wants to sell circus so outdated and Mgm doesn’t want out anymore $$$ put into that place. I’m not sure how reliable he is but it made some sense.

 

Bloomberg reporter doesn't know squat.

When it comes to TI, it's more accurate to say that Ruffin didn't fuck it up after buying it. It was already a nice place running well, and he's maintained it well.

The bigger "what if" concerns the property he owned before TI. He bought the New Frontier on speculation and did little to maintain it, much less improve it. He let the New Frontier go to hell before selling it at the peak of the crazy years.

So is he going to "New Frontier" CIrcus Circus? If I was a fan of the place, I'd be worried.

 

I’m a fan of the place, I stopped to see one of the circus acts about two weeks ago after a great meal at The Steakhouse (no $128 bottles of Jordan this time). It was two young Asian girls doing some floor exercises, no trapeze, kind of a letdown. I think MGM has been milking this place for years, although they did renovate some of the rooms about 5 years ago. I think a guy like Ruffin can keep on keeping on and play rope a dope for years and wait until the market improves up that end of the strip and someone buys it from him.

 

My one experience years back, when staying at the Riviera.

We walk through the front.
It smells.
We walk by the tables.
It smells.
We walk by the people.
They smell... badly!

Says I:” Boys, if they’re offering FREE BJ here, we’re not sitting down. Keep right on walking out the front door!”