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EAST ST. LOUIS, ILL. — Gaming and Leisure Properties Inc. (Nasdaq: GLPI) has entered into an agreement to purchase the real estate assets associated with the Casino Queen in East St. Louis for $140 million. The casino and adjacent land, which sit on approximately 78 acres, include a 157-room hotel, 38,000-square-foot casino, fine-dining steakhouse, a sports bar/entertainment venue and an RV park.
In addition, GLPI will provide Casino Queen with a $43 million loan, which will completely refinance all of the property’s outstanding long-term debt obligations. The initial lease term is 15 years, with an option to renew for four successive five-year terms.
“This is our first acquisition as a standalone company and is representative of the robust opportunities that exist in the gaming asset markets that our company is targeting,” says Peter Carlino, chairman and CEO of Wyomissing, Pa.-based GLPI.
“Gaming and Leisure Properties seeks to become a consolidator of choice and a leading provider of unique financing solutions for highly levered regional gaming operators,” adds Carlino. “The Casino Queen adds a newly constructed asset with strong market share to our portfolio and further diversifies our operating partners, while strengthening our cash flow.”
Under the terms of the agreement, GLPI will lease the property back to Casino Queen on a triple-net-lease basis for approximately $14 million per year.
The transaction is expected to close by the end of the first quarter of 2014.
GLPI was incorporated on Feb. 13, 2013, as a wholly owned subsidiary of Penn National Gaming Inc. GLPI acquires, finances and owns real estate properties to be leased to gaming operators on a triple-net-lease basis.
The company intends to elect to be taxed as a publicly traded real estate investment trust with its taxable year beginning on Jan. 1, 2014. Following its qualification as a REIT, GLPI expects to be the first gaming-focused REIT.
GLPI’s stock price closed at $49.74 per share on Monday, up from $41.20 per share on Oct. 14 when the company began trading on Nasdaq.
– Brittany Biddy