The Rio Sells for $516M
- Sep 24, 2019
Caesars Entertainment Corp. has agreed to sell the Rio All-Suite Hotel & Casino for $516.3 million to an affiliate of Imperial Cos. The deal, expected to close in the fourth quarter, comes on the heels of another major casino transaction closing: On Sep. 20, VICI Properties and Hard Rock International finalized their $745 million acquisition of the JACK Cincinnati Casino.
The agreement to sell the Rio allows Caesars to continue to operate the hotel and casino for a minimum of two years, pursuant to a lease, and pay annual rent of $45 million. Imperial Cos. has the option to pay Caesars $7 million to extend the lease under similar terms for an additional year. Caesars also has the option to continue managing the Rio at the end of the lease, if the buyer allows it, or it can provide transition services to Imperial Cos.
Both Caesars and Imperial Cos. did not respond to a request for comment on the deal.
Caesars Entertainment Corp. is a publicly owned gaming hotel and casino company that owns and operates more than 50 properties worldwide. In 2015, Caesars Entertainment Operating Corp. (CEOC), a subsidiary of Caesars Entertainment Corp., filed for Chapter 11 bankruptcy. VICI Properties was formed in 2017 as a spinoff of Caesars. The REIT owns a total of 24 casinos, hotels and racetracks, as well as four golf courses throughout the U.S. In 2018, VICI purchased the Octavius Tower at Caesars Palace in Las Vegas from Caesars Entertainment Corp. in a $507.5 million leaseback agreement.
Caesars Entertainment CEO Tony Rodio said in a press release that the deal proceeds will allow the company to “strengthen” its existing properties on the Las Vegas Strip. Those properties include Caesars Palace, Bally’s Las Vegas, Harrah’s Las Vegas, The Cromwell Las Vegas, Flamingo Las Vegas, The Linq, Paris Las Vegas and Planet Hollywood Las Vegas.