VICI Properties Inc. Announces Canyon Ranch Growth Partnership
July 26 2023 - 4:15PM
Business Wire
VICI Properties Inc. (NYSE: VICI) (“VICI Properties”, “VICI” or
the “Company”) an experiential real estate investment trust, today
announced the VICI-Canyon Ranch Growth Partnership, a multi-faceted
investment partnership to support the growth of Canyon Ranch, a
leading provider of holistic, integrative health and wellness guest
experiences. The key elements of the partnership include:
- Preferred Equity Investment: VICI committed to an up to
$150 million preferred equity investment into the controlling
entity of Canyon Ranch (“Canyon Ranch”) to support the growth and
expansion of the Canyon Ranch EcosystemTM, including enhancing
Canyon Ranch’s existing destination wellness resorts, launching the
Canyon Ranch wellness clubs and growing the capabilities of the
Canyon Ranch digital platform. The preferred equity investment has
a term of 10 years and may be redeemed by Canyon Ranch at any time,
subject to a redemption premium in the first three years.
- Call Right Agreement: VICI entered into a call right
agreement whereby VICI will have the option to call the real estate
assets of each of Canyon Ranch Tucson and Canyon Ranch Lenox,
subject to certain conditions. If the call right(s) are exercised,
Canyon Ranch would continue to operate the applicable wellness
resort(s) subject to a long-term triple net master lease with
VICI.
- Right of First Financing: Additionally, VICI entered
into a right of first financing pursuant to which VICI will have
the first right, but not the obligation, to serve as the real
estate capital financing partner for Canyon Ranch with respect to
the acquisition, build-out and/or redevelopment of future wellness
resorts.
- Mortgage Financing: VICI also intends to provide
approximately $150 million of mortgage financing secured by Canyon
Ranch Tucson and Canyon Ranch Lenox to refinance Canyon Ranch’s
existing CMBS debt secured by these two assets. The mortgage
financing will have an initial term of two years with three
one-year extensions, exercisable at Canyon Ranch’s option, subject
to satisfying certain customary extension conditions.
Key Comments
- Secular Demand Growth – Edward Pitoniak, CEO of VICI
Properties: “At VICI we seek to invest in experiential real estate
centered on experiences benefitting from longer-term secular
tailwinds. We believe wellness is one of the most powerful secular
trends of our time, and that Canyon Ranch is one of the
best-positioned global brands for capitalizing on growing demand
for wellness and life enhancement, domestically and
internationally.”
- The VICI-Canyon Ranch Growth Partnership – John Goff,
Owner of Canyon Ranch: “We are thrilled to partner with the
expertise and capital resources of VICI. VICI shares our
conviction, our values and our collaborative approach to growing
the Canyon Ranch community. This partnership offers Canyon Ranch
the potential to accelerate our growth in an ‘asset light’ manner,
especially if we are able to capitalize on the robust Canyon Ranch
economic model by acquiring with VICI conventional resorts that
have high potential for conversion to Canyon Ranch resorts, thereby
growing the Canyon Ranch network. Ed and I share conviction that
the next few years could be a very promising time to potentially
identify and acquire such resorts.”
- The Canyon Ranch Growth Opportunity – Jeff Kuster, CEO
of Canyon Ranch: “Over the last forty years, Canyon Ranch has been
creating transformational customer experiences in wellness. With
the support of VICI’s capital, we have the opportunity to further
broaden and deepen the Canyon Ranch EcosystemTM of experiential
offerings, both geographically and digitally.”
- VICI Capital Deployment – David Kieske, EVP & CFO of
VICI Properties: “Upon closing the contemplated mortgage financing,
VICI will have committed $500 million of capital to Canyon Ranch,
including our previously announced agreement to provide up to $200
million of development financing for Canyon Ranch Austin (which
comes with a call right on such asset). We are excited to continue
to grow our investment in Canyon Ranch with today’s
announcement.”
The initial $90 million tranche of the preferred equity
investment was funded with cash on hand.
In addition to this release, the Company has furnished a
Transaction Overview presentation, which is available on its
website in the "Investors" section, under the menu heading "Events
& Presentations" or please visit
https://investors.viciproperties.com/events-and-presentations.
About VICI Properties
VICI Properties Inc. is an S&P 500® 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, MGM Grand and the Venetian
Resort Las Vegas, three of the most iconic entertainment facilities
on the Las Vegas Strip. VICI Properties’ geographically diverse
portfolio consists of 50 gaming facilities across the United States
and Canada comprising approximately 124 million square feet and
features approximately 60,300 hotel rooms and more than 450
restaurants, bars, nightclubs and sportsbooks. Its properties are
occupied by industry leading gaming and hospitality operators under
long-term, triple-net lease agreements. VICI Properties has a
growing array of investing and financing partnerships with leading
non-gaming experiential operators, including Great Wolf Resorts,
Cabot, Canyon Ranch and Chelsea Piers. VICI Properties also owns
four championship golf courses and 34 acres of undeveloped and
underdeveloped land adjacent to the Las Vegas Strip. VICI
Properties’ goal is to create the highest quality and most
productive experiential real estate portfolio through a strategy of
partnering with the highest quality experiential place makers and
operators. For additional information, please visit
www.viciproperties.com.
About Canyon Ranch
Canyon Ranch is a pioneer in wellness guidance with over four
decades of experience inspiring guests to pursue a lifetime of
wellbeing. A visit to a Canyon Ranch Resort is completely unique
for each guest and can be different every time they come by
accessing a selection of over 1,500 services drawing from ancient
wisdom and modern technology. Guided by world-class experts who
integrate services across a broad range of disciplines – including
nutrition, sports & performance, spa, mental health,
spirituality and more – our guests gain personal insight, skills,
and motivation that leads to true transformation long after their
stay. The value of visiting Canyon Ranch goes well beyond our warm
hospitality, luxurious spas, nutritious cuisine, and awe-inspiring
destinations located in Tucson, Arizona; Lenox, Massachusetts;
Woodside, California and Las Vegas, Nevada. For more information,
visit www.canyonranch.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,”
“will,” 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 VICI’s control and could
materially affect actual results, performance, or achievements.
Important risk factors that may affect VICI’s business, results of
operations and financial position are detailed from time to time in
VICI’s filings with the Securities and Exchange Commission. VICI
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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version on businesswire.com: https://www.businesswire.com/news/home/20230726064374/en/
Investor Contacts: Investors@viciproperties.com (646)
949-4631
Or
David Kieske EVP, Chief Financial Officer
DKieske@viciproperties.com
Moira McCloskey SVP, Capital Markets
MMcCloskey@viciproperties.com
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