Home> US News> VICI Properties purchases the properties of Foundation Gaming for $293 million with an 8.3% capitalization rate.

VICI Properties purchases the properties of Foundation Gaming for $293 million with an 8.3% capitalization rate.

12-26 2022 casino news

VICI Properties purchases the properties of Foundation Gaming for $293 million with an 8.3% capitalization rate.

For a total of $293.4 million, real estate investment trust VICI Properties Inc. acquired the Fitz Casino & Hotel ("Fitz") in Tunica, Mississippi, and the WaterView Casino & Hotel ("WaterView") in Vicksburg, Mississippi, from casino entertainment firm Foundation Gaming & Entertainment, LLC. The cash was used for the transaction.

Subsidiaries of Foundation Gaming have consented to a triple-net master asset lease agreement as part of the purchase. The Foundation master lease has an initial period of 15 years with four 5-year tenant renewal options, an initial annual rent of $24.25 million, an implied purchase capitalization rate of 8.3%, and tenant obligations under the lease that are guaranteed by the parent company, Foundation Gaming.

Increasing market-dominant portfolio:

Three of the most recognizable buildings on the Las Vegas Strip, including Caesars Palace Las Vegas, MGM Grand, and the Venetian Resort Las Vegas, are owned by VICI, a market leader in gaming, hospitality, and entertainment. Fitz, the property acquired in the most recent deal, will add to the trust's excellent portfolio, one of the largest in the sector.

Fitz launched in 1994, and Foundation Gaming purchased it in 2018. It has about 38,500 square feet of gaming space, 864 slot machines, 9 table games, a 506-room hotel, and six food and beverage establishments. It is situated in Tunica, Mississippi.

In 2015, WaterView, the No. 2 asset in the Vicksburg market, was acquired by Foundation Gaming. It first opened its doors in 1993. The resort is located along the banks of the Mississippi River, as its name suggests, to provide exceptional tourist experiences. A hotel with 122 rooms, 650 slot machines, 10 table games, and 37,000 square feet of gaming space are all present at Water View.

An appealing capitalization rate is:

"We are thrilled to join with the skilled team at Foundation Gaming given their track record of value development in regional gaming markets," said Danny Valoy, vice president of acquisitions and finance at VICI Properties. We are excited to be extending our portfolio into the Vicksburg market at an alluring capitalization rate as Mississippi continues to be one of the major regional gaming regions.

This transaction illustrates VICI's capacity to carry out accretive agreements and close quickly in order to achieve the goals of our partners and generate value for our shareholders, according to Valoy.

strengthening the growth foundation

In practically every regional market in the US, Foundation Gaming owns, manages, and develops casino sites. According to Foundation Gaming Chairman Allan Solomon, the most recent relationship with the distinctive trust is a terrific chance to strengthen the framework for future growth.

"We have the opportunity to cooperate with VICI on our two Mississippi sites thanks to the remarkable efforts of our property teams," he claimed. And by doing this, we have set up our business for further development in the local gaming market. "We look forward to working with VICI in the future," Mr. Solomon continued, "and we would also like to thank the team at Credit Suisse for their crucial assistance with this transaction."

Recommended Stories