Caesars Entertainment buys up four Albertan casinos

VICI Properties, a real estate investment trust controlled by Caesars Entertainment, has spread its tentacles farther North by acquiring four land-based casinos in Alberta, Canada. The transaction was with Pure Canadian Gaming Corporation and it entailed the transfer of C$271.9 million into the hands of the latter.

Through a sales leaseback model, VICI acquired Pure Casino Edmonton, Pure Casino Yellowhead, Pure Casino Calgary, and Pure Casino Lethbridge. In that way, Pure Canadian Gaming Corporation entered a triple-net master lease agreement spanning 25 years. Pure will manage and operate the casinos but pay rent to VICI, with the initial annual rent starting at C$21.8 million (US$16.1 million). Starting from years two and three however, the initial rent will increase by 1.25%, at year four rent will increase either by 1.5% or based on the Canadian Consumer Price Index. Meanwhile, yearly lease increase is capped at 2.5%.

According to a release from the company, the transaction was funded by a combination of cash on hand and fromdrawing down funds under its existing revolving credit facility in Canadian
Dollars.

John Payne, President and Chief Operating Officer of VICI Properties, said,“Over the last five and a half years, VICI has built a portfolio of Market-leading experiential real estate. Today’s announcement marks another momentous first for VICI as we expand our footprint internationally into Canada with the acquisition of the PURE Portfolio. This transaction highlights our ability to source, structure, and fund cross-border transactions, widening
Our opportunity set as we continue along our growth trajectory. We are pleased to add PURE as our eleventh tenant and look forward to a mutually beneficial partnership.”

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