Realty Income has agreed to make an $800 million preferred equity investment in Blackstone's Aria Resort & Casino and Vdara Hotel & Spa, setting up a multibillion-dollar refinance of the 5,500-room portfolio on the Las Vegas Strip.
Realty Income's investment backs the larger CityCenter mixed-use complex, which comprises the Aria and Vdara and is owned by funds affiliated with Blackstone. The private equity giant is expected to retain 100% of the ownership of the Aria and Vdara real estate.
With the investment, a consortium of major banks led by JPMorgan Chase agreed to refinance a $3.15 billion commercial mortgage-backed securities loan on CityCenter, according to a federal filing for a new CMBS offering in the works, BX Trust 2025-ARIA.
The mortgage agreement comes one month after Blackstone exercised its final one-year maturity extension on the loan, extending the due date to October 2026.
Blackstone declined a request for comment from CoStar News.
The transactions demonstrate continued institutional appetite for Las Vegas assets despite market headwinds.
The Strip has faced pronounced demand erosion since early 2025, according to CoStar analysis. The 12-month average revenue per available room through October dropped 9%, driven by trade disputes, tariffs, inflation and federal employment cuts.
International visits have faltered amid geopolitical uncertainty, the CoStar report said. Meanwhile, online gaming and generational entertainment shifts are eroding traditional leisure demand. Through August, Strip occupancy averaged 82%, with average daily rates $100 above other markets.
MGM Resorts operates both the Aria and Vdara under Blackstone's ownership.
MGM's Las Vegas Strip properties recorded $601 million in earnings before interest, taxes, depreciation, amortization and restructuring or rent costs, or EBITDAR, down $130 million year over year, CEO Bill Hornbuckle reported in the company's third-quarter earnings call. Net revenue declined 7% while occupancy fell to 89% from 94%. Revenue per available room dropped 8% to $210.
MGM expects market stabilization in the fourth quarter and growth starting in 2026. More than 90% of conventions are contracted for next year, according to the company. The Aria and Vdara properties feature gaming, luxury retail, upscale dining and about 500,000 square feet of convention space.
"This represents an immediately accretive investment for Realty Income with a favorable initial yield and [internal rate of return] profile, further demonstrating the value of our size, scale and diversification," Sumit Roy, Realty Income's president and CEO, said in a statement.
The deal represents Realty Income's second Las Vegas casino resort investment with Blackstone, following a Bellagio joint venture completed in 2023.
For the record
JPMorgan Chase, Citi, Deutsche Bank, Goldman Sachs and Evercore advised Blackstone. Simpson Thacher & Bartlett served as legal counsel to Blackstone. Latham & Watkins represented Realty Income.