Investments in Unconsolidated Entities

9 Months Ended

Sep. 30, 2020

Equity Method Investments And Joint Ventures [Abstract]

Investments in Unconsolidated Entities

4. Investments in Unconsolidated Entities

On February 14, 2020, the Company closed a transaction to form a new joint venture with MGM Growth Properties LLC (“MGP”) to acquire the Las Vegas real estate assets of the MGM Grand and Mandalay Bay for $4.6 billion (the “BREIT MGP JV”). MGP owns 50.1% of the joint venture, and the Company owns 49.9%. At closing, the joint venture entered into a long-term triple net master lease agreement with MGM Resorts International (“MGM”), which provides the joint venture with a full corporate guarantee of rent payments by MGM. The lease has an initial annual rent of $292.0 million with an initial term of 30 years with two 10-year extension options for MGM. The lease agreement provides that the rent will escalate 2% annually for the first 15 years and then the greater of (i) 2% or (ii) the increase in the consumer price index during the prior year, subject to a cap of 3%.

The following table provides a summarized balance sheet of the BREIT MGP JV along with a reconciliation to the Company’s equity investment in unconsolidated entities ($ in thousands):

	September 30, 2020
Total assets	$	4,614,202
Total liabilities		(3,001,555	)
Total equity of BREIT MGP JV		1,612,647
MGP's share		807,936
BREIT's share		804,711
BREIT outside basis		9,423
BREIT net investment in BREIT MGP JV	$	814,134

The following table provides summarized operating data of the BREIT MGP JV along with a reconciliation to the Company’s income from unconsolidated entities ($ in thousands):

	Three Months Ended September 30, 2020			Nine Months Ended September 30, 2020
Total revenue	$	98,682		$	247,800
Net income of BREIT MGP JV		50,320			127,799
MGP's share		25,210			64,027
BREIT's share		25,110			63,772
Amortization of BREIT outside basis		(37	)		(94	)
BREIT net income from BREIT MGP JV	$	25,073		$	63,678