GLPI acquired the real estate assets of Baldini’s Casino in Nevada, as well as the Silverado Franklin Hotel & Gaming Complex and the Deadwood Mountain Grand (DMG) casino in South Dakota.
The Silverado is one of the biggest gaming facilities in South Dakota with 245 slot machines and a 68-room hotel. It’s also expected to undergo a hotel renovation, starting in 2024. Baldini’s stretches across nine acres with around 492 slot machines. The DMG, meanwhile, boasts a 93-suite hotel and a 13,500 square foot event centre.
GLPI chairman and chief executive Peter Carlino is excited for the future of the company’s new casino resorts. The business believes the acquisitions will prove “immediately accretive” to its operating results.
“With our acquisition of the Silverado, DMG, and Baldini’s properties, we are pleased to further diversify our property portfolio,” Carlino said.
GLPI agrees tenant relationship with Strategic
As part of the deal, GLPI also entered two cross-defaulted triple-net lease agreements with Strategic Gaming Management. Both of those agreements will initially last for 25 years, with two 10-year renewal periods also available.
GLPI also gave $5m in capital improvement proceeds, taking the total investment to $110m. The new leases’ initial aggregate annual cash rent is $9.2m, including capital improvement funding.
Also included in the deal with Strategic is the securing of a right of first refusal for GLPI on future acquisitions. This will last until Strategic’s adjusted EBITDAR in relation to GLPI-owned assets reaches an annualised amount of $40m.
The acquisition of Strategic’s properties takes GLPI’s portfolio to 65 properties in 20 states. Carlino believes the deal with Strategic will prove positive for both companies.
“With the initial transaction and our right of first refusal on growth opportunities, we look forward to the start of a long-term mutually beneficial relationship with Grant [Strategic chief executive Grant Lincoln] and Strategic,” Carlino continued.
“Our initiatives to expand our portfolio remain active in the current environment as our reputation as the gaming landlord of choice is further strengthened and reinforced by this transaction.”
Lincoln added: “We are pleased to begin our partnership with GLPI. We look forward to collaborating with GLPI to prudently grow our operations over the coming years.”
Original article: https://igamingbusiness.com/strategy/ma/glpi-acquires-three-casino-resorts/
