Caesars Sells Rio for $516 Million, Retains Ownership of World Series of Poker
For the better part of the last decade, rumors have been bandied about that Caesars was going to sell the Rio All-Suite Hotel & Casino, home of the World Series of Poker (WSOP). On Monday morning, those who predicted the casting off of the colorful off-strip property could finally gloat, as Caesars Entertainment Corporation announced that it has sold the Rio to a mystery buyer for $516.3 million. The only thing that was disclosed about the buyer is that it is “controlled by a principal of” New York-based Imperial Companies.
Caesars still in charge for now
Patrons of the Rio are unlikely to see any significant changes, at least for a couple years. For two years, Caesars will continue to operate the property while paying the new owner $45 million in rent annually. There is a third-year option as part of the deal in which the buyer can decide to pay Caesars another $7 million to extend the lease.
After that third year, if there is one, there is no further obligation from either party. The buyer, though, could ask Caesars to continue operating the Rio.
Of particular interest to poker players, of course, is the World Series of Poker. After residing at Binion’s from its creation, the WSOP moved to the Rio in 2005, though that year, the final three tables of the Main Event were still contested at Binion’s. The WSOP was at the Rio full-time starting in 2006. Caesars only sold the Rio to the buyer, not the World Series of Poker. The WSOP remains a Caesars brand.
“This deal allows Caesars Entertainment to focus our resources on strengthening our attractive portfolio of recently renovated Strip properties and is expected to result in incremental EBITDA at those properties,” said Tony Rodio, CEO of Caesars Entertainment, in a press release. “The retention of the World Series of Poker and retention of Caesars Rewards customers are all factors that make this a valuable transaction for Caesars.”
As Rodio said, Caesars gets to keep customer data; the buyer will get that data, as well. Caesars is also permitted to use that data to market to customers as it sees fit. For at least the duration of the lease, the Rio will remain a part of the Caesars Rewards program.
What happens to the WSOP?
So now the $516.3 million dollar question is: what becomes of the World Series of Poker after next year?
It has long been assumed that after the Rio was sold (an assumption itself), the World Series of Poker would move to the Caesars Forum conference center, currently under construction on the east side of the Las Vegas Strip behind Bally’s and the LINQ. It seems like a logical assumption: it’s a Caesars property, sounds like it will have plenty of room (the WSOP, after all, is currently held in the Rio’s convention center), and is in a nice, central location.
In an interview last week with CardPlayer, WSOP Vice President of Corporate Communication Seth Palansky was coy about the possibility of moving the Series, though that is understandable, since the news of the Rio’s sale was still a few days away. He said it would definitely be at the Rio in 2020 – the press release on Monday confirmed this – and that we “should feel confident” that it will still be there in 2021.
He added that because of how massive an event the World Series of Poker is, the venue is booked and logistics are planned years in advance, so changing locations is not easy. Status quo, in this case, can be the best option because the Rio is already setup to accommodate the WSOP.
It did sound like he knew the sale announcement was coming, though, as he said:
Yet, if there was a new owner in place, owners can decide whether they’re going to honor contracts or not. Right? They can decide to allow something to happen or not and can decide to be embroiled in litigation or not. We have agreements with the people operating the Rio, and therefore we feel confident.
Palansky also added that the Rio is a great location because it is situated off the Strip and has plenty of parking. Though I mentioned that the future Caesars convention center is in a prime spot, he does have a point. There are some that would prefer it to be closer to other Las Vegas hotels if they don’t stay at the Rio, but it is still very close to everything. Not necessarily walkable (unless you need your Fitbit steps), but it is a really easy drive and when I used to cover the WSOP, parking and access to the Rio’s convention center was a breeze.
That all said, once Caesar’s contract with the Rio’s buyer is up, one would think that the World Series of Poker will find another home. It would be odd for Caesars to let another company’s property host the WSOP. Even if it’s not the most profitable “convention,” it still brings hundreds of thousands of people to the Rio for a couple months, so handing that business over to a competitor probably wouldn’t be wise.