MGM Mirage said it expects to record a noncash impairment charge of approximately $955 million related to its investment in CityCenter, a resort development on the Las Vegas Strip due to open in December.
An evaluation of the CityCenter project revealed that the development has experienced a decline in value, said MGM Mirage.
Also, MGM Mirage said its joint venture with CityCenter partner Dubai World would be hit with a $348 million noncash impairment charge related to residential real estate under development. MGM Mirage said its share of the cost would be approximately $200 million.
CityCenter was required to review its residential inventory under development for impairment as of Sept. 30, mainly due to CityCenter's decision last month to discount the prices of its residential inventory by 30%, said the company.
"This decision and related market conditions led to the conclusion that the carrying value of the residential inventory is not recoverable," MGM Mirage said.
The charges will be included in MGM Mirage’s third-quarter financial report, due out Nov. 5.
