This management's discussion and analysis of financial condition and results of operations contain forward-looking statements that involve risks and uncertainties. Please see "Cautionary Statement Concerning Forward-Looking Statements" for a discussion of the uncertainties, risks and assumptions that may cause our actual results to differ materially from those discussed in the forward-looking statements. This discussion should be read in conjunction with our historical financial statements and related notes thereto and the other disclosures contained elsewhere in this Quarterly Report on Form 10-Q, the audited consolidated financial statements and notes for the fiscal year endedDecember 31, 2021 , which were included in our Form 10-K, filed with theSecurities and Exchange Commission ("SEC") onFebruary 25, 2022 . The results of operations for the periods reflected herein are not necessarily indicative of results that may be expected for future periods.MGM Resorts International together with its subsidiaries may be referred to as "we," "us" or "our."MGM China Holdings Limited together with its subsidiaries is referred to as "MGM China ."MGM Growth Properties LLC together with its subsidiaries is referred to as "MGP."
Description of our business and key performance indicators
Our primary business is the operation of casino resorts, which offer gaming, hotel, convention, dining, entertainment, retail and other resort amenities. We operate several of the finest casino resorts in the world and we continually reinvest in our resorts to maintain our competitive advantage. Most of our revenue is cash-based, through customers wagering with cash or paying for non-gaming services with cash or credit cards. We rely on the ability of our resorts to generate operating cash flow to fund capital expenditures, provide excess cash flow for future development, repay debt financings, and return capital to our shareholders. We make significant investments in our resorts through newly remodeled hotel rooms, restaurants, entertainment and nightlife offerings, as well as other new features and amenities.
Financial Impact of COVID-19
The spread of COVID-19 and developments surrounding the global pandemic have had a significant impact on our business, financial condition, results of operations and cash flows since the onset of the pandemic, which continued in the first quarter of 2022 and may continue during the remainder of 2022 and thereafter. In the first quarter of 2022, all of our properties were open and not subject to operating restrictions; however, travel and business volume were negatively affected in the early part of the first quarter of 2022 due to the spread of the omicron variant. Although all of our properties have re-opened, in light of the unpredictable nature of the pandemic, including the emergence and spread of COVID-19 variants, the properties may be subject to new operating restrictions and/or temporary, complete, or partial shutdowns in the future. At this time, we cannot predict whether jurisdictions, states or the federal government will adopt similar or more restrictive measures in the future than in the past, including stay-at-home orders or the temporary closure of all or a portion of our properties as a result of the pandemic. InMacau , our properties continue to operate subject to certain health safeguards, such as limiting the number of seats available at each table game, slot machine spacing, temperature checks, mask protection, and health declarations submitted through the Macau Health Code system. Although the issuance of tourist visas (including the individual visit scheme) for residents of mainlandChina to travel toMacau resumed in 2020, several travel and entry restrictions inMacau ,Hong Kong and mainlandChina remain in place (including the temporary suspension of ferry services betweenHong Kong andMacau , the negative nucleic acid test result certificate, and mandatory quarantine requirements for returning residents, for visitors fromHong Kong ,Taiwan , and certain regions in mainlandChina , and bans on entry on other visitors), which significantly impacted visitation to ourMacau properties.Macau is currently operating under a "dynamic zero" COVID-19 policy, as isHong Kong and mainlandChina . Under this policy, when local infections are identified several restrictions may be imposed, including the lock down of sections of cities or entire cities and travel restrictions, imposition of mass mandatory nucleic acid testing, shortening of the validity period of negative test results for re-entry into mainlandChina fromMacau and imposition of quarantine requirements, cancellation or suspension of certain events and, in some instances, closing of certain entertainment and leisure facilities. Although gaming and hotel operations have remained open during these states of immediate prevention, such measures have had a negative effect onMGM China's operations and it is uncertain whether further closures, including the closure of our properties, or travel restrictions toMacau will be implemented if additional local COVID-19 cases are identified. 24 --------------------------------------------------------------------------------
Other Developments
InApril 2022 , we completed a series of transactions with VICI Properties, Inc. ("VICI") and MGP whereby VICI acquired MGP. MGP Class A shareholders received 1.366 shares of newly issued VICI stock in exchange for each MGP Class A share outstanding and we received 1.366 units of the new VICI operating partnership ("VICI OP") in exchange for eachOperating Partnership unit previously held by us. The fixed exchange ratio represents an agreed upon price of$43 per share of MGP Class A share to the five-day volume weighted average price of VICI stock as of the close of business onJuly 30, 2021 . In connection with the exchange, VICI OP redeemed the majority of our VICI OP units for cash consideration of$4.4 billion , with us retaining an approximate 1% ownership interest in VICI OP with a fair value of approximately$375 million . MGP's Class B share that was previously held by us was cancelled. Accordingly, the Company no longer holds a controlling interest in MGP and deconsolidated MGP upon the closing of theApril 2022 transactions. As part of the transactions, we entered into an amended and restated master lease with VICI. The new master lease has an initial term of 25 years, with three 10-year renewals, and initial annual rent of$860 million , escalating annually at a rate of 2% per annum for the first 10 years and thereafter equal to the greater of 2% and the CPI increase during the prior year subject to a cap of 3%. The lease has a triple-net structure, which requires us to pay substantially all costs associated with each property, including real estate taxes, insurance, utilities and routine maintenance, in addition to the rent. Additionally, we are required to pay the rent payments under the ground leases of Borgata, Beau Rivage, andNational Harbor .
Key Performance Indicators
Key performance indicators related to gaming and hotel revenue are:
•Gaming revenue indicators: table games drop and slots handle (volume indicators); "win" or "hold" percentage, which is not fully controllable by us. Our normal table games hold percentage at ourLas Vegas Strip Resorts is in the range of 25.0% to 35.0% of table games drop for Baccarat and 19.0% to 23.0% for non-Baccarat however, reduced gaming volumes as a result of the COVID-19 pandemic could cause volatility in our hold percentages; and •Hotel revenue indicators (forLas Vegas Strip Resorts ) - hotel occupancy (a volume indicator); average daily rate ("ADR," a price indicator); and revenue per available room ("REVPAR," a summary measure of hotel results, combining ADR and occupancy rate). Our calculation of ADR, which is the average price of occupied rooms per day, includes the impact of complimentary rooms. Complimentary room rates are determined based on standalone selling price. Because the mix of rooms provided on a complimentary basis, particularly to casino customers, includes a disproportionate suite component, the composite ADR including complimentary rooms is slightly higher than the ADR for cash rooms, reflecting the higher retail value of suites. Rooms that were out of service during the three months endedMarch 31, 2021 as a result of property closures due to the COVID-19 pandemic were excluded from the available room count when calculating hotel occupancy and REVPAR.
Additional key performance indicators at
•Gaming revenue indicators -MGM China utilizes "turnover," which is the sum of nonnegotiable chip wagers won byMGM China calculated as nonnegotiable chips purchased plus nonnegotiable chips exchanged less nonnegotiable chips returned. Turnover provides a basis for measuring VIP casino win percentage. Win for VIP gaming operations atMGM China is typically in the range of 2.6% to 3.3% of turnover however, reduced gaming volumes as a result of the COVID-19 pandemic could cause volatility inMGM China's hold percentages. 25 --------------------------------------------------------------------------------
Results of Operations
Summary Operating Results
Certain of our properties or portions thereof were temporarily closed due to COVID-19 during the first quarter of 2021 as follows:
•Park MGM andMandalay Bay's hotel tower operations were closed midweek and full week hotel operations resumedMarch 3, 2021 . •The Mirage's hotel tower operations were closed midweek, with the entire property closed midweek startingJanuary 4, 2021 , and re-opened onMarch 3, 2021 . •MGM Springfield's hotel was closed and partial hotel operations resumed with midweek closures onMarch 5, 2021 . Full hotel operations resumed onDecember 13, 2021 . •MGM Grand Detroit's hotel tower operations were closed and resumed onFebruary 9, 2021 .
The following table summarizes our consolidated financial results for the three
months ended
Three Months Ended March 31, 2022 2021 (In thousands) Net revenues$ 2,854,309 $ 1,647,747 Operating income (loss) 105,788 (246,690) Net loss (34,793) (335,938)
Net loss attributable to
(331,829)
Consolidated net revenues were$2.9 billion for the three months endedMarch 31, 2022 compared to$1.6 billion in the prior year quarter, an increase of 73%. The current quarter benefited from the inclusion of the net revenues of Aria, subsequent to consolidation inSeptember 2021 and was negatively affected by a decrease in business volume and travel due to the spread of the omicron variant in the early part of the quarter, however results improved over the prior year quarter which was negatively affected by midweek property and hotel closures, lower business volume and travel activity, and operational restrictions due to the COVID-19 pandemic primarily at itsLas Vegas Strip Resorts . AtMGM China , the current and prior year quarter were significantly impacted by travel and entry restrictions inMacau with the current quarter being negatively affected by increased restrictions related to the spread of the omicron variant. As a result, net revenues at ourLas Vegas Strip Resorts increased 205%, Regional Operations increased 25%, andMGM China decreased 9%. Consolidated operating income was$106 million for the three months endedMarch 31, 2022 compared to a loss of$247 million in the prior year quarter. The change was primarily driven by the inclusion of Aria in the current quarter and the temporary property and hotel closures, lower business volumes and travel activity, and ongoing operational restrictions related to the pandemic in the prior year quarter, as discussed above, partially offset by an increase in rent expense recorded within general and administrative expense for the Aria lease, which commenced inSeptember 2021 , and in property transactions, net. Property transactions, net increased$29 million compared to the prior year quarter. The current quarter included a$31 million non-cash impairment charge related to land and a$25 million loss related to an increase in the estimate of contingent consideration related to the Empire City acquisition. 26 --------------------------------------------------------------------------------
Net Revenues by Segment
The following table presents a detail by segment of net revenues:
Three Months Ended March 31, 2022 2021 (In thousands) Las Vegas Strip Resorts Casino$ 475,298 $ 232,094 Rooms 485,288 144,329 Food and beverage 384,276 90,419 Entertainment, retail and other 318,030 78,122 1,662,892 544,964 Regional Operations Casino 703,679 596,655 Rooms 56,114 40,579 Food and beverage 91,138 50,364 Entertainment, retail and other 39,898 23,753 890,829 711,351 MGM China Casino 231,203 261,604 Rooms 15,671 13,512 Food and beverage 17,441 16,629 Entertainment, retail and other 4,060 4,609 268,375 296,354 Reportable segment net revenues 2,822,096 1,552,669 Corporate and other 32,213 95,078$ 2,854,309 $ 1,647,747 Las Vegas Strip Resorts Las Vegas Strip Resorts casino revenue was$475 million for the three months endedMarch 31, 2022 compared to$232 million in the prior year quarter, an increase of 105%. The current quarter benefited from the inclusion of Aria and was negatively affected by a decrease in business volume and travel due to the spread of the omicron variant in the early part of the quarter, however the prior year quarter was negatively affected by midweek property and hotel closures at certain properties, lower business volume and travel activity, and operational restrictions due to the pandemic. The following table shows key gaming statistics for ourLas Vegas Strip Resorts : Three Months Ended March 31, 2022 2021 (Dollars in millions) Table Games Drop$ 1,203 $ 529 Table Games Win$ 296 $ 127 Table Games Win % 24.6 % 24.1 % Slots Handle$ 4,607 $ 2,301 Slots Win$ 427 $ 212 Slots Win % 9.3 % 9.2 % 27
--------------------------------------------------------------------------------Las Vegas Strip Resorts rooms revenue was$485 million for the three months endedMarch 31, 2022 compared to$144 million in the prior year quarter, an increase of 236%. The current quarter benefited from the inclusion of Aria and was negatively affected by the omicron variant in the early part of the quarter, discussed above. REVPAR increased due to the prior year quarter being negatively impacted by lower business volume and travel activity and operational restrictions related to the pandemic. The following table shows key hotel statistics for ourLas Vegas Strip Resorts : Three Months Ended March 31, 2022 2021 Occupancy(1) 78 % 46 % Average daily rate (ADR)$ 197 $ 129 Revenue per available room (REVPAR)(1)$ 154 $ 60 (1)Rooms that were out of service, including midweek closures, during the three months endedMarch 31, 2021 due to the COVID-19 pandemic were excluded from the available room count when calculating hotel occupancy and REVPAR.Las Vegas Strip Resorts food and beverage revenue was$384 million for the three months endedMarch 31, 2022 compared to$90 million in the prior year quarter, an increase of 325%, andLas Vegas Strip Resorts entertainment, retail and other revenues was$318 million for the three months endedMarch 31, 2022 compared to$78 million in the prior year quarter, an increase of 307%, due primarily to the inclusion of Aria and was negatively affected by the omicron variant in the early part of the quarter, discussed above, while the prior year quarter was negatively impacted by temporary midweek property and hotel tower closures at certain properties, lower business volume and travel activity, and operational restrictions related to the pandemic.
Regional Operations
Regional Operations casino revenue was$704 million for the three months endedMarch 31, 2022 compared to$597 million in the prior year quarter, an increase of 18%, due primarily to table game win increasing 25% over the prior year quarter and slots win increasing 21% over the prior year quarter, respectively, as the prior year quarter was negatively affected by midweek hotel closures at certain properties and operational restrictions related to the pandemic. The following table shows key gaming statistics for our Regional Operations: Three Months Ended March 31, 2022 2021 (Dollars in millions) Table Games Drop$ 1,021 $ 819 Table Games Win$ 216 $ 173 Table Games Win % 21.2 % 21.2 % Slots Handle$ 6,662 $ 5,384 Slots Win$ 638 $ 526 Slots Win % 9.6 % 9.8 % Regional Operations rooms revenue was$56 million for the three months endedMarch 31, 2022 compared to$41 million in the prior year quarter, an increase of 38%, due to the prior year quarter being negatively affected by midweek hotel closures at certain properties and operational restrictions related to the pandemic. Regional Operations food and beverage revenue was$91 million for the three months endedMarch 31, 2022 compared to$50 million in the prior year quarter, an increase of 81% and Regional Operations entertainment, retail and other revenue was$40 million for the three months endedMarch 31, 2022 compared to$24 million in the prior year quarter, an increase of 68%, due primarily to the prior year quarter being negatively affected by operational restrictions related to pandemic. 28
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The following table shows key gaming statistics for
Three Months Ended March 31, 2022 2021 (Dollars in millions) VIP Table Games Turnover$ 963 $ 2,373 VIP Table Games Win $ 23$ 78 VIP Table Games Win % 2.4 % 3.3 % Main Floor Table Games Drop$ 1,096 $ 1,044 Main Floor Table Games Win$ 239 $ 230 Main Floor Table Games Win % 21.8 % 22.0 %MGM China net revenues were$268 million for the three months endedMarch 31, 2022 compared to$296 million in the prior year quarter, a decrease of 9%. The current quarter was more significantly impacted by a decrease in travel as well as entry restrictions inMacau primarily related to the spread of omicron variant inHong Kong and mainlandChina .
Corporate and other
Corporate and other revenue includes revenues from other corporate operations, management services and reimbursed costs revenue primarily related to ourCityCenter management agreement (which was terminated upon the acquisition ofCityCenter inSeptember 2021 ). Reimbursed costs revenue represents reimbursement of costs, primarily payroll-related, incurred by us in connection with the provision of management services and was$12 million and$58 million for the three months endedMarch 31, 2022 and 2021, respectively, which decreased compared to the prior year quarter due primarily to the termination of theCityCenter management agreement, as discussed above. See below for additional discussion of our share of operating results from unconsolidated affiliates.
Adjusted Property EBITDAR and Adjusted EBITDAR
The following table presents Adjusted Property EBITDAR and Adjusted EBITDAR. Adjusted Property EBITDAR is our reportable segment GAAP measure, which we utilize as the primary profit measure for our reportable segments. See Note 11 in the accompanying consolidated financial statements and "Reportable Segment GAAP measure" below for additional information. Adjusted EBITDAR is a non-GAAP measure, discussed within "Non-GAAP measures" below. Three Months Ended March 31, 2022 2021 (In thousands) Las Vegas Strip Resorts$ 593,634 $ 108,119 Regional Operations 313,279 241,982 MGM China (25,656) 4,775 Corporate and other (210,853) (136,991) Adjusted EBITDAR$ 670,404
Las Vegas Strip Resorts Adjusted Property EBITDAR was$594 million for the three months endedMarch 31, 2022 compared to$108 million in the prior year quarter, an increase of 449%. Las Vegas Strip Resorts Adjusted Property EBITDAR margin increased to 35.7% for the three months endedMarch 31, 2022 compared to 19.8% in the prior year quarter as the current year quarter benefited from the increase in revenues, discussed above, and the realized benefits of cost savings initiatives. 29
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Regional Operations
Regional Operations Adjusted Property EBITDAR was$313 million for the three months endedMarch 31, 2022 compared to$242 million in the prior year quarter, an increase of 29%. Regional Operations Adjusted Property EBITDAR margin increased to 35.2% for the three months endedMarch 31, 2022 compared to 34.0% in the prior year quarter as the current year benefited from the increase in revenues, discussed above, and the realized benefits from cost savings initiatives.
MGM China Adjusted Property EBITDAR was a loss of$26 million for the three months endedMarch 31, 2022 compared to Adjusted Property EBITDAR of$5 million in the prior year quarter. The decrease was due primarily to the decrease in revenues, discussed above, and the current quarter included an$18 million charge related to litigation reserves. License fee expense was$5 million for each of the three month periods endedMarch 31, 2022 and 2021.
Supplemental Information - Same-store Results of Operations
The following table presents the financial results ofLas Vegas Strip Resorts on a same-store basis for the three months endedMarch 31, 2022 and 2021. Same-Store Adjusted Property EBITDAR is a non-GAAP measure, discussed within "Non-GAAP measures" below. Three Months Ended March 31, 2022 2021 (In thousands) Las Vegas Strip Resorts net revenues$ 1,662,892 $ 544,964 Acquisitions (1) (311,293) - Las Vegas Strip Resorts same-store net revenues$ 1,351,599
Las Vegas Strip Resorts Adjusted Property EBITDAR
$ 108,119 Acquisitions (1) (121,220) -
Las Vegas Strip Resorts Same-Store Adjusted Property EBITDAR
$ 472,414
(1)The net revenues and Adjusted Property EBITDAR of Aria have been excluded for periods subsequent to its acquisition onSeptember 27, 2021 in determiningLas Vegas Strip Resorts same-store net revenues andLas Vegas Strip Resorts Same-Store Adjusted Property EBITDAR.
Loss from Unconsolidated Affiliates
The following table summarizes information related to our share of operating loss from unconsolidated affiliates:
Three Months Ended March 31, 2022 2021 (In thousands) CityCenter $ -$ (2,831) MGP BREIT Venture 38,936 38,962 BetMGM (91,993) (59,236) Other 6,219 (2,474)$ (46,838) $ (25,579) InSeptember 2021 , we completed the acquisition of the 50% ownership interest inCityCenter held byInfinity World and now own 100% of the equity interest inCityCenter . Accordingly, we no longer account for our interest inCityCenter under the equity method of accounting, and we now consolidateCityCenter in our financial statements. 30 --------------------------------------------------------------------------------
Non-operating Results
Interest Expense
Gross interest expense was$196 million for each of three months endedMarch 31, 2022 and 2021. See Note 5 to the accompanying consolidated financial statements for discussion on long-term debt and see "Liquidity and Capital Resources" for discussion on issuances and repayments of long-term debt and other sources and uses of cash. Other, net
Other income, net was
Income Taxes
Our effective income tax rate was a benefit of 51.1% and 22.0% on loss before income taxes for the three months endedMarch 31, 2022 and 2021, respectively. Both the current year quarter and prior year quarter were unfavorably impacted by losses inMacau that we could not benefit, although the current year quarter was more greatly impacted due to the expected mix of domestic income andMacau losses. The effective rate in the prior year quarter was also favorably impacted by a release of tax reserves in conjunction with the closure of the most recentNew Jersey state audit forMarina District Development Company .
Reportable segment GAAP measure
"Adjusted Property EBITDAR" is our reportable segment GAAP measure, which we utilize as the primary profit measure for our reportable segments and underlying operating segments. Adjusted Property EBITDAR is a measure defined as earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, preopening and start-up expenses, rent expense associated with triple-net operating and ground leases, income from unconsolidated affiliates related to investments in real estate ventures, and property transactions, net, and also excludes corporate expense and stock compensation expense, which are not allocated to each operating segment, and rent expense related to the master lease with MGP that eliminates in consolidation. We manage capital allocation, tax planning, stock compensation, and financing decisions at the corporate level. "Adjusted Property EBITDAR margin" is Adjusted Property EBITDAR divided by related segment net revenues.
Non-GAAP measures
"Same-Store Adjusted Property EBITDAR" is Adjusted Property EBITDAR further adjusted to exclude the Adjusted Property EBITDAR of acquired operating segments from the date of acquisition through the end of the reporting period. Accordingly, we have excluded the Adjusted Property EBITDAR of Aria for periods subsequent to its acquisition onSeptember 27, 2021 in Same-Store Adjusted Property EBITDAR for the periods indicated. Same-Store Adjusted Property EBITDAR is a non-GAAP measure and is presented solely as a supplemental disclosure to reported GAAP measures because management believes this measure is useful in providing meaningful period-to-period comparisons of the results of our operations for operating segments that were consolidated for the full period presented to assist users of the financial statements in reviewing operating performance over time. Same-Store Adjusted Property EBITDAR should not be viewed as a measure of overall operating performance, considered in isolation, or as an alternative to our reportable segment GAAP measure or net income, or as an alternative to any other measure determined in accordance with generally accepted accounting principles, because this measure is not presented on a GAAP basis, and is provided for the limited purposes discussed herein. In addition, Same-Store Adjusted Property EBITDAR may not be defined in the same manner by all companies and, as a result, may not be comparable to similarly titled non-GAAP financials measures of other companies, and such differences may be material. A reconciliation of our reportable segment Adjusted Property EBITDAR GAAP measure to Same-Store Adjusted Property EBITDAR is included herein. "Adjusted EBITDAR" is earnings before interest and other non-operating income (expense), taxes, depreciation and amortization, preopening and start-up expenses, property transactions, net, rent expense associated with triple-net operating and ground leases, and income from unconsolidated affiliates related to investments in real estate ventures.
Adjusted EBITDAR information is a non-GAAP measure that is a valuation metric, should not be used as an operating metric, and is presented solely as a supplemental disclosure to reported GAAP measures because we believe this
31 -------------------------------------------------------------------------------- measure is widely used by analysts, lenders, financial institutions, and investors as a principal basis for the valuation of gaming companies. We believe that while items excluded from Adjusted EBITDAR may be recurring in nature and should not be disregarded in evaluation of our earnings performance, it is useful to exclude such items when analyzing current results and trends. Also, we believe excluded items may not relate specifically to current trends or be indicative of future results. For example, preopening and start-up expenses will be significantly different in periods when we are developing and constructing a major expansion project and will depend on where the current period lies within the development cycle, as well as the size and scope of the project(s). Property transactions, net includes normal recurring disposals, gains and losses on sales of assets related to specific assets within our resorts, but also includes gains or losses on sales of an entire operating resort or a group of resorts and impairment charges on entire asset groups or investments in unconsolidated affiliates, which may not be comparable period over period. However, as discussed herein, Adjusted EBITDAR should not be viewed as a measure of overall operating performance, an indicator of our performance, considered in isolation, or construed as an alternative to operating income or net income, or as an alternative to cash flows from operating activities, as a measure of liquidity, or as an alternative to any other measure determined in accordance with generally accepted accounting principles because this measure is not presented on a GAAP basis and excludes certain expenses, including the rent expense associated with our triple-net operating and ground leases, and is provided for the limited purposes discussed herein. In addition, other companies in the gaming and hospitality industries that report Adjusted EBITDAR may calculate Adjusted EBITDAR in a different manner and such differences may be material. We have significant uses of cash flows, including capital expenditures, interest payments, taxes, real estate triple-net lease and ground lease payments, and debt principal repayments, which are not reflected in Adjusted EBITDAR. A reconciliation of GAAP net loss to Adjusted EBITDAR is included herein.
The following table presents a reconciliation of net loss attributable to
Three Months Ended March 31, 2022 2021 (In thousands) Net loss attributable to MGM Resorts International$ (18,016) $ (331,829) Plus: Net loss attributable to noncontrolling interests (16,777) (4,109) Net loss (34,793) (335,938) Benefit for income taxes (36,341) (94,698) Loss before income taxes (71,134) (430,636) Non-operating (income) expense: Interest expense, net of amounts capitalized 196,091 195,295 Non-operating items from unconsolidated affiliates 15,133 20,836 Other, net (34,302) (32,185) 176,922 183,946 Operating income (loss) 105,788 (246,690) Preopening and start-up expenses 434 5 Property transactions, net 54,738 26,071 Depreciation and amortization 288,638 290,551 Triple-net operating lease and ground lease rent expense 262,452 189,620 Income from unconsolidated affiliates related to real estate ventures (41,646) (41,672) Adjusted EBITDAR$ 670,404
Guarantor Financial Information
As ofMarch 31, 2022 , all of our principal debt arrangements are guaranteed by each of our wholly owned material domestic subsidiaries that guarantee our senior credit facility. Our principal debt arrangements are not guaranteed by MGP, theOperating Partnership ,MGM Grand Detroit ,MGM National Harbor , BlueTarp reDevelopment, LLC (the entity that owns and operatesMGM Springfield ), and each of their respective subsidiaries. Our foreign subsidiaries, includingMGM China and its subsidiaries, are also not guarantors of our principal debt arrangements. In the event that any subsidiary is no longer a guarantor of our credit facility or any of our future capital markets indebtedness, that subsidiary will be released and relieved of its obligations to guarantee our existing senior notes. The indentures governing the senior notes further 32
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provide that in the event of a sale of all or substantially all of the assets of, or capital stock in a subsidiary guarantor then such subsidiary guarantor will be released and relieved of any obligations under its subsidiary guarantee. The guarantees provided by the subsidiary guarantors rank senior in right of payment to any future subordinated debt of ours or such subsidiary guarantors, junior to any secured indebtedness to the extent of the value of the assets securing such debt and effectively subordinated to any indebtedness and other obligations of our subsidiaries that do not guarantee the senior notes. In addition, the obligations of each subsidiary guarantor under its guarantee is limited so as not to constitute a fraudulent conveyance under applicable law, which may eliminate the subsidiary guarantor's obligations or reduce such obligations to an amount that effectively makes the subsidiary guarantee lack value. The summarized financial information of us and our guarantor subsidiaries, on a combined basis, is presented below. As ofMarch 31, 2022 , certain of our guarantor subsidiaries collectively ownOperating Partnership units and each subsidiary accounts for its respective investment under the equity method within the summarized financial information presented below. These subsidiaries have also accounted for the MGP master lease as an operating lease, recording operating lease liabilities and operating ROU assets with the related rent expense of guarantor subsidiaries reflected within the summarized financial information.
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