MGM Mirage has secured $2.3 billion (Dh8.4bn) of the remaining $3bn in funding needed for its massive CityCenter project on the Las Vegas Strip, the hotel operator's president said.
Jim Murren said MGM received a commitment last week for $300 million from China Construction Bank, which follows a recent $150m from three other banks and $100m from a fifth bank.
The company said earlier in August that it received lending commitments from several banks totalling $1.65bn and expected to finalise the total $3bn financing package by the end of September.
Murren, who is also MGM's Chief Operating Officer, said he expects to meet that deadline.
"I am more certain than ever that this is the direction we need to go in," Murren said of the $9.1bn CityCenter development of hotels, condominiums and retail outlets.
The project, which is scheduled to open late next year, is under construction at the same time the US economy has stalled and weak consumer sentiment has led to a dip in visitation to Las Vegas.
Murren said negotiations with banks have centred on "a spirited debate over pricing", with the loan package priced at about 375 basis points over Libor.
"Banks are significantly culling their relationships, but they want to maintain core clients," he said.
Murren said MGM is paying a Libor spread higher than what it would have paid a year ago, but said the loan package stacks up well against the last joint venture financing the company undertook – the 2001 deal with Boyd Gaming for the Borgata resort in Atlantic City. That financing was also done at about 375 points above Libor, but the underlying Libor rate was much higher at the time, Murren explained.
"We did not want to overpay on this financing," Murren said.
Last August, MGM agreed to sell half of the CityCenter development to Dubai World, which also plans to acquire a stake of up to 20 per cent in the world famous MGM itself.