MGM Mirage is planning to open a palatial hotel in Tianjin, China, and will do so without a gambling element.
The company, with joint-venture partner Diaoyutai State Guesthouse of China, is expected to build a 35-room hotel called MGM Grand Tianjin, which will include a 50-suite Skylofts at MGM Grand and 60 condominiums. The company is developing a $3 billion resort in Abu Dhabi that is also gambling free.
Analysts have said hotel stocks have a better chance of retaining value than casino stocks, which have tumbled in the last year, according to the Wall Street Journal. MGM Mirage officials are considering splitting its hotel operations into a separate entity, the WSJ reported. The company has a hospitality subsidiary called MGM Mirage Hospitality and has experience operating hotels like the Bellagio in Las Vegas.
"We believe this hospitality entity could ultimately be spun off in a separate publicly traded company and would expect many more deals like this one in geographies like Asia, the Middle East, Europe and northern Africa," Deutsche Bank AG gambling analyst Bill Lerner wrote in an investor note about the Tianjin announcement, according to the WSJ.