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Blackstone Agrees to Sell Cosmopolitan Hotel for $5.65 Billion

Blackstone says the sale is the asset management firm's most profitable for a single asset ever.

Blackstone  (BX) - Get Blackstone Group Inc. Class A Report reached an agreement to sell The Cosmopolitan hotel and casino on the Las Vegas Strip for $5.65 billion the company announced Monday after purchasing the property in 2104.

The asset management firm said that the sale is the company's most profitable for a single asset ever in a private letter to investors, the Wall Street Journal reported. 

"This transaction underscores Blackstone’s ability to acquire and transform large, complex assets," said Tyler Henritze, head of acquisitions America for Blackstone Real Estate, said in a Monday statement

Blackstone acquired the two-tower property for $1.8 billion and invested another $500 million on upgrades including renovating the hotel's nearly 3,000 guest rooms while also adding luxury suites and restaurants and bars. 

Total profits from the sale will be about $4.1 billion, including cash flow from the property's operations, according to a letter viewed by the Journal. The company said it made back nearly 10 times the amount of equity it invested in the property. 

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The sale separates ownership of the property from the hotel and casino operations, which are being sold to MGM Resorts International MGM for $1.625 billion.

A partnership that includes a Blackstone Real Estate Investment Trust is acquiring the property for about $4 billion, according to the investor letter.

The transaction is expected to close in early 2022.

Blackstone on Sept. 7 announced that it planned to acquire smart access products owner Chamberlain Group for about $5 billion. Its products include garage device LiftMaster. 

Shares of Blackstone on Monday were falling 2.3% to $122.21 at last check.