NEW YORK--(BUSINESS WIRE)--VICI Properties Inc. (NYSE: VICI), an experiential real estate investment trust, today announced it has agreed to provide a $400 million mortgage loan secured by the Caesars Forum Convention Center in Las Vegas. The loan will bear interest at a rate of 7.7%, with payments subject to 2% annual escalation, and will have a term of 5 years pre-payable beginning in year 3 subject to certain conditions. The Caesars Forum Convention Center will remain subject to the existing Put/Call Agreement between Caesars Entertainment Corporation and VICI, with certain modifications, including VICI’s call option accelerating to 2025.
Additionally, VICI Properties has agreed to acquire approximately 23 acres of undeveloped land parcels adjacent to the center of the Las Vegas Strip for a purchase price of $4.5 million per acre for total proceeds of approximately $103.5 million. The acquisition of these land parcels, in addition to the existing 27 acres VICI owns, will give VICI control of 50 acres of land in the vicinity of Harrah’s Las Vegas, The Linq, Flamingo, Bally’s, Paris and Planet Hollywood on the east side of the Las Vegas Strip. Additionally, the VICI land parcel will be adjacent, along its entire western length, to the Las Vegas Monorail, which carries approximately 4.6 million passengers a year, and will also be alongside The High Roller, a skyride attraction that generates approximately 1.5 million visits per year.
The loan and the acquisition of the land parcels are pursuant to a non-binding letter of intent with Eldorado Resorts, Inc. (“Eldorado”) and the closing of such transactions is conditioned upon the business combination of Eldorado and Caesars and remains subject to completion of due diligence and negotiation of definitive documentation, and other customary closing conditions. The closing of the loan and the acquisition of the land are intended to close concurrently and are cross conditioned.
“These investments express VICI’s strong conviction in Caesars’ market leadership, in Las Vegas as the world’s foremost convention destination and in Strip-proximate land as an opportunity to capitalize on the long-term growth of Las Vegas,” said Ed Pitoniak, Chief Executive Officer of VICI Properties. “Our mortgage on the Caesars Forum Convention Center will produce immediate economic benefits for VICI’s stockholders and incremental liquidity for the combined Caesars/Eldorado. Our consolidation of the land parcels that run from the Caesars Forum Convention Center and the adjacent and magnificent MSG Sphere at the north to the backside of Planet Hollywood at the south gives VICI an unrivaled opportunity, over time, to partner with world-class developers and operators in creating the next great Las Vegas place—a multi-property, multi-dimensional experience.”
John Payne, President and Chief Operating Officer of VICI Properties said, “We are excited to announce this creative transaction with our largest tenant, which demonstrates our ability to structure transactions that are mutually beneficial for all parties while growing our revenue base accretively and maximizing optionality. The Caesars Forum Convention Center sets a new standard for convention facilities and we are thrilled to structure this transaction for a truly state of the art property. From the day we started VICI in the Fall of 2017 we have always worked, energetically, to create and execute solutions that contribute to our tenants’ success and our stockholders’ long-term value creation.”
About VICI Properties
VICI Properties is an experiential real estate investment trust that owns one of the largest portfolios of market-leading gaming, hospitality and entertainment destinations, including the world-renowned Caesars Palace. VICI Properties’ national, geographically diverse portfolio consists of 28 gaming facilities comprising over 40 million square feet and features approximately 15,600 hotel rooms and more than 180 restaurants, bars and nightclubs. Its properties are leased to industry leading gaming and hospitality operators, including Caesars Entertainment Corporation, Century Casinos Inc., Hard Rock International, JACK Entertainment and Penn National Gaming, Inc. VICI Properties also owns four championship golf courses and 34 acres of undeveloped land adjacent to the Las Vegas Strip. VICI Properties’ strategy is to create the nation’s highest quality and most productive experiential real estate portfolio. For additional information, please visit www.viciproperties.com.
