MSG Sphere’s Owners Sell Off Nightclub Group Stake After Construction Costs Soar
April 19, 2023 by Dave Haynes
The developers behind MSG Sphere, that big LED-clad ball going up behind The Venetian in Las Vegas, have sold off the majority stake it held in a company that runs a lot of the flashier nightclubs in that city, with observers speculating that was necessary to offset the cost overruns on an entertainment and events venue set to open in a few months.
Mohari Hospitality has purchased Madison Square Garden Entertainment Inc.’s 67% stake in Tao Group for $550 million, with the deal expected to close in May. Tao Group oversees the Tao, Hakkasan, Omnia, Marquee, Wet Republic and Lavo brands in Las Vegas, and has some 80 “branded locations” around the globe.
When the Sphere was first announced, the construction budget was about $1.2 billion, but by the time it does open (with U2 doing a series of live concerts inside the big ball), the cost is expected to be more like $2.2 billion, or almost double what was expected just a few years ago.
This piece in The Street gets into the back story, including firings and layoffs, and the current state of things …
I have had at least a couple of runs at trying to get a podcast interview going with the MSG Sphere people, but not had any success. I don’t have any particular reason to care about final construction costs, other than how it impacts ticket prices. But everything is now insanely expensive in Las Vegas (except rooms at Circus Circus), so we all kind of know they’ll be crazy-high for whatever is on.
I am, however, looking forward to seeing what this thing looks like fully lit at night. If schedules hold, it should be live by the time DSE rolls around in early December.