LVS Las Vegas Sands Corp

By Hannah Karp 

Madison Square Garden Co. and Las Vegas Sands Corp. plan to open a 400,000-square-foot, 17,500-seat concert venue on the Las Vegas Strip, highlighting the growing importance of entertainment in the gambling enclave.

Slated to be connected to Las Vegas Sands' Venetian and Palazzo resorts, the new concert space pits the two companies and their partners in the venture -- including concert promoter Live Nation Entertainment Inc. and artist manager Irving Azoff -- against Live Nation's rival, Anschutz Entertainment Group.

AEG and MGM Resorts International co-own the T-Mobile Arena, which opened last month with shows by Guns N' Roses. That was the first new venue of its size to open in the city in two decades.

Wednesday's announcement didn't include a name for the planned venue, whose seats are all to be positioned in front of the stage. In most sports arenas some seats end up behind the stage for concerts. The companies didn't provide a total cost or opening date.

Las Vegas Sands is also trying to help build a largely taxpayer-financed stadium to house the National Football League's Raiders, who are considering moving to Las Vegas from Oakland.

AEG and MGM designed the 20,000-seat T-Mobile Arena with state-of-the-art locker rooms that could help lure the city's first major-league sports team, as the National Hockey League considers launching an expansion team there or elsewhere. But the partners are also prepared to operate it without a resident sports team, focusing on entertainment.

Las Vegas has several other arenas, including the 16,800-seat MGM Grand Garden Arena inside MGM's namesake casino, though these others are at least 20 years old.

Despite the competition, MSG' Executive Chairman James Dolan said in a statement that Las Vegas is "an underserved market" that was cultivated and brought to his attention by Mr. Azoff, whose management clients include the Eagles, Steely Dan, Van Halen and Christina Aguilera.

Their joint venture, Azoff MSG Entertainment, also manages MSG's historic Forum in Inglewood, Calif., which was renovated and reopened in 2013 as a music-focused venue.

"We believe this opportunity in Las Vegas, which welcomes more than 40 million people a year, will take this model to a whole new level," Mr. Azoff said in the same statement.

The partners have also going head-to-head with AEG in New York, with rival music festivals.

AEG will hold its inaugural Panorama festival on New York's Randall's Island in July -- billed as an East Coast version of its Coachella festival in California desert -- while Live Nation recently announced it was acquiring Governor's Ball, slated for June, also on Randall's Island. AEG had originally aimed to host Panorama at Flushing Meadows Corona Park in Queens, but their bid was rejected after MSG subsequently applied to host its own three-day festival on the same site.

Write to Hannah Karp at hannah.karp@wsj.com

(END) Dow Jones Newswires

May 25, 2016 12:49 ET (16:49 GMT)

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