For many years, the Rio All-Suite Hotel & Casino has been the subject of a painstaking number of rumors about what will become of it. Now, Caesars Entertainment has officially announced that they have sold the Rio for $516.3 million to a group controlled in principal by Imperial Companies.
But that doesn’t necessarily mean Rio will be revamped or torn down. Imperial, a real estate investment, development, and management company, will lease the Rio to Caesars for $45 million for each of the next two years. Caesars will continue to operate the off-strip casino and hotel even after the sale to Eldorado Resorts is finalized next year.
Naturally, that means the World Series of Poker will remain at Rio.
“This deal allows Caesars Entertainment to focus our resources on strengthening our attractive portfolio of recently renovated Strip properties and is expected to result in incremental EBITDA at those properties,” said Tony Rodio, CEO of Caesars Entertainment.
The deal seems as though it makes sense for Caesars as well as the real estate investors.
World Series Of Poker will remain at Rio next year
Rumors about this sale again kicked into overdrive more than a week ago when Seth Palansky, vice president of corporate communication for the World Series of Poker, tweeted the following:
Can 100% confirm @WSOP will take place at the Rio in Las Vegas in 2020
— Seth Palansky (@SethPalansky) September 14, 2019
The buzz from this tweet about the WSOP led to speculation that there would be news about the property. Only days later did the public learn that Caesars finally sold the off-strip property but will continue to operate it, and that the WSOP will remain at the Rio for at least another year.
The many rumors included talk of a Major League Baseball stadium
Rio has been on the chopping block at Caesars for at least five years. The hotel’s fate has been the subject of much speculation, even going back to when late journalist Robin Leach tweeted about an off-strip casino being sold for $400 million.
The sale means that the rumor about a baseball stadium being built on the land won’t come to fruition in the next couple of years. (Earlier this year the Henderson area in Las Vegas tried to lure the Arizona Diamondbacks with a plan to build a new stadium further away from the Vegas Strip.)
But one rumor about the sale came true: Imperial Companies did buy the Rio. While Michael Fascitelli (part-owner of the NBA’s Milwaukee Bucks) won’t operate the casino, his company now owns the property.
Five years and countless rumors later, the sales price is about 20% more than Leach said it would fetch back in 2014.
Up next: Will Eldorado Resorts continue leasing Rio when it takes over Caesars?
This sale works out very nicely for when the sale of Caesars to Eldorado becomes final. The two-year leaseback to Caesars will give the new operators of the company some flexibility when the takeover begins next year.
Eldorado has the option of letting the lease expire and moving on from Rio. They could also continue the lease beyond 2021. The latter seems more plausible at the moment. Polansky’s tweet above says the World Series of Poker will be at the Rio in 2020. The lease continues into 2021 but WSOP isn’t guaranteed to return just yet.
The WSOP and all online Caesars assets were part of the merger deal between Eldorado Resorts and Caesars. Executives at Eldorado plan to develop Caesars online gaming, including WSOP.com, when they take over.
Since Eldorado’s initial conference call with investors about the merger with Caesars. they’ve only referred to the Las Vegas market as the “Vegas Strip region.” The Rio is not on the Vegas Strip and has never been part of any comments regarding new operations at Caesars.
Just when we thought the Rio rumors were done, they pull us back in! The Rio rumor mill will take a break for a little while but should ramp up again in the next year or so.