Commissioners voted that state rules requiring longer leases equal to the length of MGM’s gaming license plus 60 years would not apply in this case because those rules were in effect during the construction and development phase.
Commissioners said the 45-year lease provides stability.
The sale is expected to conclude in the fourth quarter of 2021.
On Thursday, the panelists also approved wording about what could happen if gambling regulators decide that a subsidiary or its executives are deemed “inappropriate” under state law for a financial interest in casino ownership. But the details of this process are still being worked out.
The deal between MGM Resorts International’s flagship casino, which was first announced in May, frees up money for the parent company and provides tax breaks for investors in real estate subsidiary MGM Growth Properties. The deal is part of MGM Resorts’ long-term strategy and has been talked about in Springfield for three years.
Under the deal, MGM is selling the property for $ 400 million to MGM Growth Properties and will lease it for approximately $ 30 million a year. The sale of MGM Growth Properties will not affect day-to-day operations.
MGM Resorts’ local subsidiary, Blue Tarp, remains the licensee.
Massachusetts Gambling Commissioner Enrique Zuniga said the deal is beneficial to the Commonwealth because of the business advantages it gives MGM.
The Gambling Commission has already approved a similar deal for Plainridge Park Casino.
Another Massachusetts casino, 88 acres of Plainridge Park in Plainville, has been owned by another REIT since 2014 called Gaming and Leisure Properties. Gaming and Leisure Properties is a subsidiary of Penn National Gaming, which operates Plainridge Park.
MGM Springfield will be added to the existing main lease between MGM Resorts and MGM Growth Properties, which already includes a dozen MGM properties in Las Vegas, MGM Northfield Park in Northfield, Ohio, Empire Resort Casino in Yonkers, New York, and a retail / an entertainment complex called The Park in Las Vegas.