Caesars Gets $400 Million From VICI
The funds came in the form of a mortgage loan secured by the gaming giant’s new Caesars Forum Convention Center (l.) on the Las Vegas Strip. VICI is also negotiating with Caesars to acquire 50 acres of prime Strip land for future development.
VICI Properties, the real estate investment trust affiliated with Caesars Entertainment, is lending the gaming giant $400 million.
The five-year loan is payable at 7.7 percent interest and is secured by a mortgage on the new $375 million Caesars Forum Convention Center on the Las Vegas Strip.
The loan, which VICI said it funded with cash on hand, is seen as a balance sheet-strengthening move for Eldorado Resorts, which completed its $17.3 billion acquisition of Caesars in July.
The REIT said also it is negotiating a $103.5 million deal with Caesars to acquire 23 acres of developable land adjacent to the convention center and behind three Caesars resorts, Harrah’s Las Vegas, the Linq and Flamingo Las Vegas.
The acquisition, together with an additional 27 acres of undeveloped land behind three other Caesars resorts which VICI owns𑁋Bally’s Las Vegas, Paris Las Vegas and Planet Hollywood𑁋gives the REIT a full 50 acres which VICI CEO Ed Pitoniak has termed “the only large-scale opportunity to deepen the Las Vegas Strip at its center.”
“We see this as a way of capitalizing on what we still very strongly believe to be the long-term growth of Las Vegas,” Pitoniak said on VICI’s second-quarter earnings conference call in July. “We see that land as giving us a chance to participate, not only in the growth of Las Vegas tourism but in the growth of Las Vegas as a place where people choose to work and live as well as to play.”
VICI owns 29 casinos and racinos nationwide, including Harrah’s Las Vegas and Strip landmark Caesars Palace and 16 other casinos operated by Caesars under the Harrah’s, Horseshoe, Caesars and Harvey’s brands.