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Caesars Entertainment Operating Company (CEOC), parent of the Caesars Palace Las Vegas, said it plans to form a REIT (real estate investment trust) to raise cash to pay down debt at the 51-year-old hotel.
CEOC, the Caesars Entertainment division that filed for chapter 11 protection in early 2015 and earlier this year outlined a plan to emerge from it, said that it has hired JP Morgan Securities and Barclays Capital to raise as much as $2.2 billion to pay down the debt at the 3,974-room hotel. CEOC owns, operates or manages 37 resorts in 14 states under the Caesars, Harrah’s and Horseshoe brands.
The plan is the latest in the continual restructuring Caesars Entertainment and its affiliates have attempted or undergone since 2008 when the company, then known as Harrah’s Entertainment, was taken private by Apollo Global Management and TPG Capital Management in a $30 billion leveraged buyout. It hasn’t been profitable since.
CEOC’s filing for Chapter 11 generated opposition from some of Caesars’ creditors, who had taken issue with the restructuring strategy of splitting off Caesars’ relatively healthy Las Vegas assets from Caesars Palace as well as its underperforming properties in Atlantic City and other regions. CEOC’s plans to emerge from bankruptcy and pare down its $18 billion in debt was approved by an Illinois federal judge earlier this year.
In 2015, Caesars started a renovation program for the 586-room original tower at the Caesars Palace Las Vegas, which opened in 1966, and rechristened it as the Julius Tower when it reopened early last year.
Caesars also said last year that it would improve its Las Vegas offerings by refurbishing the 948-room Augustus Tower at Caesars Palace and the 1,294-room Planet Hollywood Resort & Casino as well as 1,320 rooms at the Paris Las Vegas and 672 rooms at Harrah’s Las Vegas.
Caesars isn’t the only Las Vegas-based casino-resort operator to go the REIT route to raise capital or reduce debt. Last year, MGM Resorts International spun off much of its real estate holdings into a REIT called MGM Growth Properties. That entity owns 10 pieces of real estate that include more than 24,000 hotel rooms and more than 2.3 million square feet of meetings space. Seven of the properties are in Las Vegas.
Sоurсе: travelweekly.com
, parent of the Caesars Palace Las Vegas, said it plans to form a REIT (real estate investment trust) to raise cash to pay down debt at the 51-year-old hotel. CEOC, the Caesars Entertainment division that… "Pin It")