Gaming & Leisure Properties Completes Acquisition of Tropicana Las Vegas and Provides Update on April Rent Collections
April 20 2020 - 7:00AM
Gaming and Leisure Properties, Inc. (NASDAQ: GLPI or “GLPI” or the
“Company”) today announced the completion of the previously
announced acquisition of Tropicana Las Vegas Casino Hotel Resort
(the “Tropicana”) and provided an update on the collection of April
2020 rents for its portfolio of the real estate for 44 gaming and
related facilities.
Tropicana Purchase Agreement and
LeaseOn April 16, 2020, the Company and certain of its
subsidiaries acquired the real property associated with the
Tropicana from Penn National Gaming, Inc. (Nasdaq: PENN or “Penn
National”) in exchange for rent credits of $307.5 million, which
will be applied to rent due under the parties’ existing leases for
the months of May, June, July, August, October and a portion of
November 2020.
Pursuant to the terms of the transaction with
Penn National, GLPI will conduct a sale process with respect to the
Tropicana Las Vegas (including the casino and hotel
business). If a definitive agreement for the sale is entered
into during the first year of the sale process, Penn National
Gaming will receive 75% of the net proceeds above $307.5 million
plus certain taxes, expenses and costs. If a definitive
agreement is entered into during the second year of the sale
process Penn National Gaming will receive 50% of the proceeds above
$307.5 million plus certain taxes, expenses and costs, in each
case, subject to the terms and conditions in the Tropicana Purchase
Agreement. GLPI will receive all proceeds from any sale occurring
after the initial two years.
Simultaneous with GLPI’s acquisition of the
Tropicana, the Company entered into a lease with Penn National for
the Tropicana for nominal annual rent and Penn National will
continue to operate the property for two years (subject to three
one-year extensions at GLPI’s option) or until the Tropicana is
sold, whichever is earlier. The lease is a triple net lease
relieving the Company from carrying and other costs at the property
during the lease term.
In conjunction with the transaction, the
Company’s credit facility lenders offered broad cooperation without
a fee and with support of 83% to amend the revenue definition
included in the Company’s credit agreement to allow non-cash rent
to be included in all covenant calculations as cash
equivalents.
April RentsWhile all of GLPI’s
tenants’ properties as well as the Company’s two TRS properties
were closed in mid-March as a result of COVID-19 related
precautions, the Company collected 98.6% of contractual April rent,
including amounts paid by Penn National.
GLPI's Chairman and Chief Executive Officer,
Peter Carlino, commented, “GLPI believes its collaborative and
mutually beneficial outcome with Penn National provides us and our
investor base greater visibility and predictability for rent
receipts over the remainder of 2020. We are also grateful to
our credit facility lenders for their support in facilitating the
transaction with Penn National in a manner that acknowledges the
unforeseen circumstances and that represents a unified spirit of
cooperation to overcome the challenges presented by COVID-19.”
About Gaming and Leisure
PropertiesGLPI is engaged in the business of acquiring,
financing, and owning real estate property to be leased to gaming
operators in triple-net lease arrangements, pursuant to which the
tenant is responsible for all facility maintenance, insurance
required in connection with the leased properties and the business
conducted on the leased properties, taxes levied on or with respect
to the leased properties and all utilities and other services
necessary or appropriate for the leased properties and the business
conducted on the leased properties.
Forward-Looking StatementsThis
press release includes “forward-looking statements” within the
meaning of Section 27A of the Securities Act and
Section 21E of the Securities Exchange Act of 1934, as
amended, including our expectations regarding the collection of
future rent receipts in 2020. Forward-looking statements can be
identified by the use of forward-looking terminology such as
“expects,” “believes,” “estimates,” “intends,” “may,” “will,”
“should” or “anticipates” or the negative or other variation of
these or similar words, or by discussions of future events,
strategies or risks and uncertainties. Such forward looking
statements are inherently subject to risks, uncertainties and
assumptions about GLPI and its subsidiaries, including risks
related to the following: the effect of pandemics such as COVID-19
on the business operations of GLPI’s tenants and their continued
ability to pay rent in a timely manner or at all; GLPI’s ability to
sell the Tropicana, including receipt of all required regulatory
approvals, or other delays or impediments to completing the
proposed transaction; GLPI's ability to maintain its status as a
REIT; GLPI’s ability to access capital through debt and equity
markets in amounts and at rates and costs acceptable to GLPI; the
impact of our substantial indebtedness on our future operations;
changes in the U.S. tax law and other state, federal or local laws,
whether or not specific to REITs or to the gaming or lodging
industries; and other factors described in GLPI’s Annual Report on
Form 10-K for the year ended December 31, 2019, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K, each as
filed with the Securities and Exchange Commission. All subsequent
written and oral forward-looking statements attributable to GLPI or
persons acting on GLPI’s behalf are expressly qualified in their
entirety by the cautionary statements included in this press
release. GLPI undertakes no obligation to publicly update or revise
any forward-looking statements contained or incorporated by
reference herein, whether as a result of new information, future
events or otherwise, except as required by law. In light of these
risks, uncertainties and assumptions, the forward-looking events
discussed in this press release may not occur.
Contact |
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Investor Relations – Gaming and Leisure Properties,
Inc. |
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Steven T. Snyder |
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Joseph Jaffoni, Richard Land, James Leahy |
610/378-8215 |
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212/835-8500 |
investorinquiries@glpropinc.com |
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glpi@jcir.com |
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