MGM MIRAGE Provides Update on CityCenter Progress
20 Abril 2007 - 11:00AM
PR Newswire (US)
Project Size Increases by 670,000 Square Feet 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
preopening 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 preopening 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 contract signing. 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.
Risks related to construction and development projects: The
Company's plans for future construction can be affected by a number
of factors, including time delays in obtaining necessary
governmental permits and approvals and legal challenges. The
Company may make changes in project scope, budgets and schedules
for competitive, aesthetic or other reasons, and these changes may
also result from circumstances beyond the Company's control. These
circumstances include weather interference, shortages of materials
and labor, work stoppages, labor disputes, unforeseen engineering,
environmental or geological problems, and unanticipated cost
increases. Any of these circumstances could give rise to delays or
cost overruns. For more information, please refer to the Company's
Form 10-K for the year ended December 31, 2006, filed with the
Securities and Exchange Commission. MGM MIRAGE (NYSE:MGM), one of
the world's leading and most respected hotel and gaming companies,
owns and operates 19 properties located in Nevada, Mississippi and
Michigan, and has investments in three other properties in Nevada,
New Jersey and Illinois. The Company has entered into an agreement
to sell its Colorado Belle and Edgewater properties located in
Laughlin, Nevada. In addition, the Company has major new
developments under construction in Nevada, Michigan and Macau
S.A.R. CityCenter is a multi-billion dollar mixed-use urban
development in the heart of the Las Vegas Strip; a new MGM Grand
hotel and casino complex is being built in downtown Detroit; and
the Company has a 50% interest in MGM Grand Macau, a hotel-casino
resort currently under construction in Macau S.A.R. MGM MIRAGE
supports responsible gaming and has implemented the American Gaming
Association's Code of Conduct for Responsible Gaming at its
properties. MGM MIRAGE also has been the recipient of numerous
awards and recognitions for its industry-leading Diversity
Initiative and its community philanthropy programs. For more
information about MGM MIRAGE, please visit the company's website at
http://www.mgmmirage.com/. 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. DATASOURCE: MGM MIRAGE
CONTACT: Investment Community, James J. Murren, President, Chief
Financial Officer & Treasurer, +1-702-693-8877, or Media, Alan
M. Feldman, Senior Vice President, Public Affairs, +1-702-891-7147,
both of MGM MIRAGE Web site: http://www.mgmmirage.com/
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