Banking On The Bellagio Brand

Like many other brands, MGM Mirage has decided to make money by selling its name. The brand, which has been struggling all year, particularly with the battle to get the huge $8.5 billion Las Vegas CityCenter project completed, is in need of some cash. MGM Mirage has inked 10 franchise deals with hotels carrying the Bellagio and MGM Grand name deals that will let the brand expand in a way that it could not on its own seeing as it is already $12 billion in debt.

The deals are a first for MGM Mirage. Two MGM Grand casino resorts are planned for Ho Tram, Vietnam and Sharm el-Sheikh, Egypt. Other plans include Bellagios in Cairo, Mumbai and four in China. Bellagio, MGM Grand and Skyloft hotels will also be franchised in Dubai. These deals will give MGM Mirage two to three percent of gross sales with an additional 10 precent if a property achieves its profit goals. MGM Mirage is hoping that branded resorts will attract visitors even without gambling which means they will have to position themselves as a distinctive hotel brand that doesn't rely on a casino as a main atraction. What MGM Mirage and Bellagio do have that some other hotels don't is experience at maintaining full service complexes with restaurants, nightclubs, shops and entertainment all designed to make the guest so happy that they never want to step outside.