MGM MIRAGE Provides Update on CityCenter Progress
Project Size Increases by 670,000 Square Feet
Residential Sales Exceed $800 Million to Date
LAS VEGAS, April 20 /PRNewswire-FirstCall/ -- MGM MIRAGE (NYSE:
MGM) today provided updated information on its CityCenter cost estimates and
the progress of the residential sales efforts.
CityCenter Program and Cost Estimates
Construction of all components of CityCenter is well underway. The components
of CityCenter remain unchanged while the gross construction square footage has
increased by 670,000 square feet. Management has updated CityCenter's gross
construction costs to a total of approximately $7.4 billion, excluding land
costs and pre-opening expenses. Management also has updated its estimate of
expected gross proceeds from the sale of residential units, from $2.5 billion to
$2.7 billion, resulting in a new estimated net cost of CityCenter of $4.7
billion versus the previous estimate of $4.3 billion. In each case, these net
costs exclude approximately $200 million in pre-opening expenses.
"In a project of the magnitude and complexity of CityCenter, variances are to
be expected," said Terry Lanni, Chairman and Chief Executive Officer of MGM
MIRAGE. "Our revised estimate of costs and revenues represents the increase to
the overall development size as well as the tremendous public response to the
residential offerings. Unit sales have been robust, and CityCenter continues to
track to an on-schedule opening in November 2009."
Residential Sales Progress
Sales of residential units commenced in January 2007 and have been
exceptionally strong. Through April 19, 2007, contracts for the sale of
residential units have been executed representing over $800 million in sales
proceeds at average sales per square foot above original projections. These
contracts are accompanied by non-refundable deposits equal to 10% of the
purchase price at signing, with a second 10% deposit due in six months from
The Company is currently converting reservations to sales contracts for Vdara,
the 1,543-unit condominium-hotel tower. During its initial release, the Company
has received over 700 reservations and anticipates converting approximately 60%
of such units to sales contracts. To date, over 300 of these reservations have
been converted to sales contracts. The Company has also begun taking
reservations for the two 335-unit Veer towers, and has received over 630
reservation deposits. The Company has only recently begun converting
reservations to contract. The residential program at the Mandarin Oriental has
been tremendously successful with approximately 90% of the 227 units sold out at
higher average price per square foot than originally anticipated. The Company
expects to release approximately 200 residences at The Harmon later this year.
CityCenter is MGM MIRAGE's dazzling vertical city in the heart of the Las Vegas
Strip between Bellagio and Monte Carlo resorts. The development combines into a
single urban core approximately 2,700 private residences, two 400-room
non-gaming boutique hotels (one of which will be managed by luxury hotelier
Mandarin Oriental), a dramatic 60-story, 4,000-room resort casino, and a
470,000-square-foot retail and entertainment district. CityCenter is a design
collaboration between MGM MIRAGE and eight of the world's foremost architects
including Foster and Partners, Gensler, Helmut Jahn, KPF Architects, Pelli
Clarke Pelli, Rockwell Group, RV Architecture LLC led by Rafael Vinoly and
Studio Daniel Libeskind.
Statements in this release which are not historical facts are "forward looking"
statements and "safe harbor statements" Under the Private Securities Litigation
Reform Act of 1995 that involve risks and/or uncertainties, including risks
and/or uncertainties as described in the company's public filings with the
Securities and Exchange Commission.
Lake Las Vegas