VICI Properties Inc. Completes $4 Billion Acquisition of the Venetian Resort Las Vegas
23 Febbraio 2022 - 10:15PM
Business Wire
– Adds Iconic World-Class Facility to Real
Estate Portfolio – – Increases Annual Rent by $250 Million –
VICI Properties Inc. (NYSE: VICI) (“VICI Properties” or the
“Company”), an experiential real estate investment trust, today
announced it has completed the previously announced transaction to
acquire all of the land and real estate assets associated with the
Venetian Resort Las Vegas and the Venetian Expo and Convention
Center Las Vegas, located in Las Vegas, Nevada (the “Venetian
Resort”) for $4.0 billion in cash, representing a 6.25% cap rate.
The Company financed the transaction with proceeds from the
settlement of 119 million shares previously raised under its March
2021 and September 2021 forward sale agreements, a $600 million
draw under its recently upsized revolving credit facility, and cash
on hand.
“In scale and in quality The Venetian is one of the foremost
assets in American commercial real estate,” said Edward Pitoniak,
VICI’s Chief Executive Officer. “We’re proud to become the
long-term stewards of the property envisioned, created and superbly
sustained by the Adelson family and the Las Vegas Sands Management
Team.”
Simultaneous with the closing of the transaction, the Company
entered into a triple-net lease agreement for the Venetian Resort
with an affiliate of funds managed by affiliates of Apollo Global
Management, Inc. (NYSE: APO) (the “Apollo Funds”). The lease has
initial annual rent of $250.0 million and an initial term of 30
years, with two ten-year tenant renewal options. Rent under the
lease will escalate at the greater of 2.0% or CPI (subject to a
3.0% ceiling), beginning the earlier of lease year three or when
the Venetian Resort achieves certain financial milestones.
The lease contains customary capital expenditure requirements
and Las Vegas Sands Corp. (NYSE: LVS) has agreed to provide lease
payment support designed to guarantee the Venetian Resort’s rent
obligations under the lease through 2023, with early termination of
such lease payment support if the property achieves a certain
financial milestone or in the event of a tenant change of
control.
Additionally, VICI Properties has the opportunity to fund up to
an additional $1.0 billion development at the property through the
Company’s Partner Property Growth Fund.
John Payne, President and Chief Operating Officer of VICI
Properties, said, “We are thrilled to complete the acquisition of
this remarkable world-class asset. Over the past two quarters, the
Venetian’s financial results far exceeded our initial underwriting
expectations, demonstrating the significant attractiveness of the
property to consumers and proving the relevance of Las Vegas as a
global entertainment destination. We are excited about our
partnership with Apollo in Las Vegas and have confidence in their
vision for the continued success of the Venetian.”
The Venetian Resort Las Vegas, built in phases since 1999,
features:
- Three hotel towers:
- The 35-story Venetian Tower has 3,015 luxury suites in a
three-winged array;
- The 12-story Venezia Tower features 1,013-suites;
- The 50-story Palazzo Tower has 3,064 luxury suites featuring
modern European ambience and design, and is directly connected to
The Venetian Tower and Venetian Expo Center
- Approximately 225,000 square feet of gaming space and
approximately 210 table games and 1,480 slot machines and
electronic table games
- A variety of amenities including the Paiza Club, an exclusive
area for premium guests, several theaters and Canyon Ranch
SpaClub
- The Venetian Resort offers approximately 2.3 million gross
square feet of state-of-the-art exhibition and meeting facilities
that can be configured to provide small, mid-size or large meeting
rooms and/or accommodate large-scale multi-media events or trade
shows
- The Venetian Expo Center, one of the largest overall trade show
and convention facilities in the United States (as measured by net
leasable square footage), with approximately 1.2 million gross
square feet of exhibit and meeting space
- The Venetian Resort also contains an approximately 1.1
million-gross-square-foot meeting and conference facility that
links Venetian Expo Center to the Venetian Resort Las Vegas
- This mix of hotel, gaming, food and beverage, entertainment,
shopping and meeting and conference features makes the Venetian
Resort diversified across multiple sources of revenue
- An enclosed retail, dining and entertainment complex, referred
to as the Grand Canal Shoppes, which is owned by Brookfield
Properties
Madison Square Garden Entertainment Corp. ("MSG") is working to
bring a 400,000-square-foot venue built specifically for music and
entertainment to Las Vegas. MSG is currently building the MSG
Sphere, an 18,000-seat venue, which will be located on the Venetian
Resort property and is currently expected to open in 2023. VICI
Properties owns the land under the MSG Sphere.
Morgan Stanley & Co LLC acted as lead strategic and
financial advisor to VICI Properties and Deutsche Bank Securities
acted as a financial advisor to VICI Properties on the transaction.
Kramer Levin Naftalis & Frankel LLP served as legal advisor and
Hogan Lovells served as tax advisor to VICI Properties.
About VICI Properties
VICI Properties Inc. is an experiential real estate investment
trust that owns one of the largest portfolios of market-leading
gaming, hospitality and entertainment destinations, including
Caesars Palace Las Vegas, Harrah’s Las Vegas and the Venetian
Resort Las Vegas, three of the most iconic entertainment facilities
on the Las Vegas Strip. VICI Properties’ national, geographically
diverse portfolio consists of 28 gaming facilities comprising over
62 million square feet and features approximately 25,000 hotel
rooms and more than 250 restaurants, bars, nightclubs and
sportsbooks. Its properties are leased to industry leading gaming
and hospitality operators, including Caesars Entertainment, Inc.,
Century Casinos, Inc., the Eastern Band of Cherokee Indians, Hard
Rock International Inc., JACK Entertainment LLC, Penn National
Gaming, Inc. and the Apollo Funds. VICI Properties also has an
investment in the Chelsea Piers, New York facility and owns four
championship golf courses and 34 acres of undeveloped land adjacent
to the Las Vegas Strip. VICI Properties’ strategy is to create the
nation’s highest quality and most productive experiential real
estate portfolio. For additional information, please visit
www.viciproperties.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the federal securities laws. You can identify these
statements by our use of the words “assumes,” “believes,”
“estimates,” “expects,” “guidance,” “intends,” “plans,” “projects,”
and similar expressions that do not relate to historical matters.
All statements other than statements of historical fact are
forward-looking statements. You should exercise caution in
interpreting and relying on forward-looking statements because they
involve known and unknown risks, uncertainties, and other factors
which are, in some cases, beyond the Company’s control and could
materially affect actual results, performance, or achievements.
Important risk factors that may affect the Company’s business,
results of operations and financial position (including those
stemming from the COVID-19 pandemic and changes in the economic
conditions as a result thereof and risks relating to the Company’s
pending transactions) are detailed from time to time in the
Company’s filings with the Securities and Exchange Commission. The
Company does not undertake any obligation to update or revise any
forward-looking statement, whether as a result of new information,
future events, or otherwise, except as may be required by
applicable law.
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Investor Contacts: Investors@viciproperties.com (646)
949-4631
Or
David Kieske EVP, Chief Financial Officer
DKieske@viciproperties.com
Danny Valoy Vice President, Finance
DValoy@viciproperties.com
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