Hard Rock Hotel & Casino Sold

Peter Morton’s Hard Rock Hotel is no longer Peter Morton’s. It’s been no secret that the resort has been up for sale for a while, but in a deal announced late yesterday, Morgans Hotel Group Co. has signed definitive agreements to acquire not only the hotel & casino, but an adjacent 23-acre land parcel and other related assets for a price of $770 million.

Morton co-founded the Hard Rock brand in 1971 and in 1995 he opened the Hard Rock Hotel & Casino in Las Vegas. In 1996, he sold his chain of Hard Rock Cafes to the Rank Group for $410 million, but the Vegas property wasn’t included in the deal. It was rumored that the Rank Group were the front runners to snap up the property, so it was a surprise when MHG was declared the new owner yesterday.

The only thing holding back the full signing is that MHG needs to first obtain a gaming license before the takeover can become official. That process has become much easier since former chairman Ian Schrager stepped down to a consultant position. Schrager is unable to hold a gaming license because he still has criminal charges on his record from his time as co-owner of the legendary nightclub, Studio 54.

MHG already owns several successful high-end boutique hotels such as the Delano and Shore Club in Miami, the Hudson in New York City and the Mondrian in Los Angeles. They also have other plans to expand into the Las Vegas market. The company has already announced a joint-venture with Boyd Gaming for the Echelon Place development, which will be anchored by a Delano and a Mondrian hotel. This is scheduled to open in 2010.

“We are excited about adding the Hard Rock Hotel & Casino to our portfolio,” W. Edward Scheetz, President and Chief Executive Officer of MHG, stated. “Since Las Vegas is the largest hotel market in the U.S., it is key for our growth strategy. This transaction provides us with an immediate and highly-visible entry into this market.”

The acquisition also includes the rights to use the “Hard Rock Hotel” and “Hard Rock Casino” trademarks in connection with casinos and hotel/casinos in specified locations, as well as certain other intellectual property such as merchandising and retail rights.