The Las Vegas Raiders area already able to chalk up a victory this year after selling their unfinished Henderson, Nevada, headquarters for $191 million — more than 30 times what the purchase price — and leasing it back.
The buy-back deal is gaining popularity around the country and numerous deals of theatnature have happened in the Las Vegas area recently. The Raiders’ move is notable since some argue they pulled a massive real estate flip at taxpayers’ expense.
In February 2018, the Henderson City Council unanimously approved the sale of 55 acres of land near the Henderson Executive Airport for $6.05 million to the Raiders. The price was approximately half of the property’s value. In July 2018 at a live auction, an 8.15-acre parcel near the headquarters went for $8.25 million.
But they’re already paying off some of those debts by selling the facility to Chicago-based Mesirow Financial last week, per the Las Vegas Review-Journal. The $191 million sale closed Friday and the company leased it back to the Raiders for 29 years. There are seven 10-year extension options that extend it to 99 years, per the Review-Journal. The Raiders’ rent was not made public.
The Raiders are far from the first business to buy land, build and then immediately sell to lease. There have been recent casino buy-backs on the Las Vegas strip, including at Caesars Entertainment Corp, per the Review-Journal.
Companies sell the property and choose to lease so they can cash in on the real estate investment, pay down debt, buy a company or issue a dividend to shareholders. Those buying the property can do so for less due to low interest rates and can get better overall returns, a real estate investor told the Review-Journal.
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