Gaming and Leisure Properties to Buy 2 Casinos for $484M

The three-party deal will involve the purchases of both an Indiana casino from Caesars Entertainment and a Delaware casino from Twin River Worldwide Holdings, with both properties to be leased to Twin River.
Tropicana Evansville. Image via Google Street View

Gaming and Leisure Properties Inc. has agreed to acquire the real property assets of Dover Downs Hotel & Casino, in Delaware, from Twin River Worldwide Holdings Inc. and to re-acquire the real property assets of Tropicana Evansville, in Indiana, from Caesars Entertainment Inc. after the substitution right related to the property was triggered.


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GLPI will acquire Tropicana Evansville’s real property assets for about $340 million, and Twin River will acquire its operating assets for about $140 million.

Separately, GLPI will execute a sale-leaseback directly with Twin River for Dover Downs and will acquire the real property for $144 million.

The two properties have an aggregate real estate purchase price of about $484 million.

Simultaneously with those closings, GLPI will enter into a new triple-net master lease with Twin River for both assets, with an initial term of 15 years and four five-year tenant renewal options. The initial annual cash rent will be $40 million, representing an implied capitalization rate of 8.3 percent.

In a prepared statement, GLPI Chairman & CEO Peter Carlino noted that the deals diversify GLPI’s portfolio with the addition of a new operator and expand the company’s footprint into Delaware.

The transactions are expected to close in mid-2021, subject to receipt of required regulatory approvals and other customary closing conditions.

Second side of the triangle

Further information on the deal comes from the announcement by Caesars Entertainment, which indicated that it’s selling Tropicana Evansville for $480 million in cash, subject to a customary working capital adjustment.

Pursuant to an exchange agreement with GLPI, Caesars noted, it has agreed to add the real estate associated with Isle Casino Hotel Waterloo and Isle Casino Hotel Bettendorf, both in Iowa, to the GLPI master lease. This reportedly gave Caesars full ownership of Tropicana Evansville and the ability to sell it in whole.

Milbank LLP represented Caesars Entertainment on the transaction.