WYOMISSING, Pa., Jan. / PRNewswire / – Gaming and Leisure Properties, Inc. (NASDAQ: GLPI) (“GLPI” or “the Company”) announced today that the Company has entered into a binding term sheet with Bally’s Corporation (NYSE: BALY ) (“Bally’s”) to acquire the real estate assets of Ballys Casino property in Black Hawk, CO, and the property to be acquired in Rock Island, IL in a transaction which is subject to regulatory approval and is expected to occur later in close this year. The consideration for the acquisition totaled $ 150 million. The parties anticipate that they will add the properties to the master lease they will enter into in connection with Bally’s previously announced acquisitions of Tropicana Evansville and Dover Downs Hotel & Casino (“GLPI-BALY Master Lease”), thereby creating an additional rent of USD 12.0 million will be generated Rental coverage for the assets is expected to be 2.25 times in the first calendar year after the acquisition. The acquisitions of Ballys Properties in Rock Island and Black Hawk are expected to close in early 2022.
In addition, Bally’s has granted GLPI a right of first refusal to fund the cost of acquiring or developing real estate associated with all potential future transactions in Michigan, Maryland, New York, and Virginia through one or more sale-leaseback or similar transactions for one Term of seven years.
Bally’s also plans to acquire both GLPI’s non-state real estate assets and Penn National Gaming, Inc. (NASDAQ: PENN) (“Penn National” )’s outstanding stakes in Tropicana Las Vegas Hotel and Casino, Inc. for a cash purchase price of $ 150 million. GLPI retains ownership of the property while entering into a 50-year long lease with an initial annual rent of $ 10.5 million. The leasehold is supported by a corporate guarantee from Bally and is in default with the GLPI-BALY main lease. This transaction is expected to close in early 2022.
Both GLPI and Bally are committed to a structure in which GLPI has the potential to acquire additional assets through sale-leaseback transactions, should Bally choose to use GLPI’s capital as a source of funding for the proposed Gamesys acquisition Group plc. The $ 500 million commitment provides Bally with an alternative funding commitment that may be funded by equity, additional prepaid sale-leaseback transactions, or secured loans, at GLPI’s sole discretion.
Peter Carlino, Chairman and CEO of GLPI, commented, “We are excited to expand our relationship with Bally’s through a complex transaction that is a win-win for both companies. With strong rental coverage and a rising cap rate, the transaction expands and diversifies our master lease again with the addition of Bally’s properties in Rock Island, IL and Black Hawk, CO. We’re also delighted to have secured the right of first refusal for any possible future assets. In addition, our conversion of the Tropicana into an income-generating long-term lease further solidifies the added value we hoped for when we originally structured the deal with Penn National. “
About play and leisure properties
GLPI deals with the acquisition, financing and ownership of real estate to be rented to gaming operators under triple net leasing agreements under which the tenant is responsible for all maintenance of the facilities associated with the leased real estate The necessary insurance and insurance is responsible for the business with the leased objects, taxes that are levied on or in relation to the leased objects, as well as all necessary or appropriate utilities and other services and the business with the leased objects.
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including our ability to obtain necessary approvals and meet requirements for the completion of the announced transactions. Forward-looking statements may be identified by the use of forward-looking terminology such as “expects,” “believes,” “estimates,” “intends”, “may,” “will,” “should” or “anticipates” or “negative or other variations of these or” similar words or through discussions of future events, strategies or risks and uncertainties. Such forward-looking statements are inherently subject to risks, uncertainties and assumptions relating to GLPI and its subsidiaries, including the following risks: The effects of pandemics such as the novel coronavirus (COVID) 19) on GLPI as a result of the impact over such pandemics in the operations of GLPI’s tenants and their continued ability to pay rent on time or not at all; GLPI’s ability to successfully complete the announced transactions with Bally, including the ability of the parties to to meet various conditions for the conclusion including obtaining any necessary regulatory approvals or other delays or obstacles to the completion of the proposed transactions; GLPI’s ability to maintain its REIT status; our ability to access capital through the debt and stock markets in amounts and at rates and costs acceptable to GLPI; the impact of our substantial debt on our future business; Changes in US tax law and other state, state, or local laws, whether or not specific to REITs or the gaming or accommodation industries; and other factors described in the GLPI Annual Report on Form 10-K for the year ended December 31, 2020, the Quarterly Reports on Form 10-Q, and the most recent reports on Form 8-K, each filed with the Securities and Exchange Commission. All subsequent written and oral forward-looking statements that are attributable to GLPI or persons acting on behalf of GLPI are expressly qualified in their entirety by the cautionary statements contained in this press release. GLPI undertakes no obligation to publicly update or revise any forward-looking statements, contained herein or incorporated by reference, as a result of new information, future events or for any other reason, except as required by law. Given these risks, uncertainties, and assumptions, the forward-looking events discussed in this press release may not occur as illustrated, or may not occur at all.
Play and Recreational Real Estate, Inc.
Matthew Demchyk, Chief Investment Officer
610 / 401-2900
Joseph Jaffoni, Richard Land, James Leahy at JCIR
212 / 835-8500