Bally’s will pay GLPI $150 million to own and operate the Rat Pack-era hotel-casino Tropicana Las Vegas at the south end of the Strip and $10.5 million annually to lease the 34-acre site.
A week after finalizing its acquisition of a casino in Lake Tahoe, Bally’s Corp. announced plans to land on the Las Vegas Strip.
The Rhode Island-based company said Tuesday it will buy the Tropicana Las Vegas in a transaction with Gaming and Leisure Properties valued at $308 million.
Bally’s will pay GLPI $150 million to own and operate the Rat Pack-era hotel-casino at the south end of the Strip and $10.5 million annually to lease the 34-acre site. The rental agreement is for 50 years and is subject to increases.
In a statement, Bally’s CEO George Papanier said the expansion would support the company’s growth and development of its online and interactive business. He also said Bally’s would consider a “significant redevelopment” of the 1,470-room hotel-casino.
However, Bally’s Chairman Soo Kim, on a conference call Tuesday morning with analysts to discuss the company’s acquisition of online betting operator Gamesys PLC, said the company would take its time in redeveloping the site.
“The light financial burden of this transaction allows George and his team to go in and get the operations in order,” Kim said. “We’ll wait for the right time to redevelop it. We saw an opportunity (to acquire the property) that might not come again.”
Penn National Gaming currently operates the Tropicana and had sold the property to GLPI last April in exchange for rent credits.
The transaction is expected to close in early 2022 but could happen sooner since Bally’s, Kim, and Papanier were licensed by Nevada gaming regulators in March in conjunction with the company’s purchase MontBleu Casino Resort in Lake Tahoe.
The Tropicana Las Vegas is on a 35-acre parcel on the corner of Tropicana Boulevard and the Strip. In addition to the hotel, the property has 50,000 square feet of casino space, a 1,200-seat performance theater, and 100,000 square feet of convention and meeting space.
Bally’s, formerly known as Twin River Worldwide Holdings, acquired its name and trademarks from Caesars Entertainment last year for $20 million. Caesars, however, retained the rights to the name Bally’s Las Vegas, which is attached to the company’s Strip resort adjacent to Paris Las Vegas.
Caesars also currently owns three additional Tropicana-branded properties in Laughlin, Nevada; Evansville, Indiana; and Atlantic City. Bally’s has a pending deal to purchase Tropicana Evansville.
Also on Tuesday, Bally’s said it entered into a sale-leaseback agreement with GLPI for its properties in Black Hawk, Colorado, and a casino Bally’s is in the process of acquiring in Rock Island, Illinois. The lease will have initial annual fixed rent of $12 million, subject to increase over time, and GLPI will pay $150 million to own the properties.
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source: cdcgamingreports.com
