VICI, Penn National Gaming Complete $1B Deal for Greektown Casino
VICI Properties has completed the purchase of the land and real estate assets of the Greektown Casino-Hotel for approximately $700 million in cash, with Penn National Gaming acquiring the operating assets for approximately $300 million in cash.
DETROIT—The partnership of New York City-based VICI Properties, Inc. and Penn National Gaming, Inc. of Wyomissing, PA has completed the $1-billion purchase of the Greektown Casino Hotel in Downtown Detroit.
VICI Properties has completed the purchase of the land and real estate assets of the Greektown Casino-Hotel for approximately $700 million in cash, with Penn National Gaming acquiring the operating assets for approximately $300 million in cash. The deal for the property was originally announced in November 2018.
Simultaneous with the closing of this transaction, Penn National entered into a triple-net lease agreement with VICI Properties. The lease has an initial total annual rent of approximately $55.6 million and an initial term of 15 years, with four, five-year tenant renewal options. The tenant’s obligations under the lease are guaranteed by Penn National.
John Payne, president and COO of VICI Properties, says of its latest purchase “The Greektown acquisition is our second transaction with Penn National, further solidifying our relationship with a best-in-class operator and demonstrating our commitment to deliver portfolio income of the highest character and quality. In the past five months we have closed on three large-scale acquisitions, deploying $1billion in proceeds while adding approximately $100 million of annualized rent, and broadening our geographic diversity by expanding into two new jurisdictions.”
David Kieske, EVP and chief financial officer of VICI Properties, notes, “We utilized the cash proceeds on our balance sheet that we raised during our successful November 2018 equity issuance to fund the Greektown transaction. Going forward, we continue to target leverage neutral financing over the long-term and will manage our balance sheet prudently to maximize transaction accretion while maintaining flexibility for long-term growth.”
Opened in 2000, Greektown Casino-Hotel is the only casino in the heart of downtown Detroit and is located in close proximity to nearby attractions such as Comerica Park, Ford Field, Little Caesars Arena, the city’s theater district, GM’s Renaissance Center and the Cobo Conference Center.
The casino features 100,000 square feet of casino space, approximately 2,700 gaming machines and 60 table games, a poker room, three restaurants, seven fast casual food outlets, four bars and a coffee shop. In addition, the casino includes a AAA Four Diamond 400-room, luxury high-rise hotel with 14,000 square feet of event and catering space. The property employs approximately 1,700 team members and has partnered with nearly 20 local restaurants to offer fine dining rewards to guests.
In March, Greektown Casino reported that it is bringing the first Wahlburgers restaurant to Michigan this summer. The celebrity-owned burger restaurant and bar will be located at 569 Monroe St. in Detroit’s historic Greektown Entertainment District. Wahlburgers is expected to open this summer with plans to convert the space to two stories, bringing the total square footage to 4,200-square feet.