American real estate investment trust Gaming and Leisure Properties Incorporated has announced the signing of definitive agreements that are to see it pay in the region of $1.81 billion so as to acquire a trio of casino properties from operator The Cordish Companies.

The Pennsylvania-based organization used an official Monday press release to detail that the deals will result in it assuming ownership over the Live! Casino and Hotel Maryland venue by the end of December in addition to the Live! Casino Pittsburgh and Live! Casino and Hotel Philadelphia enterprises early in the new year before immediately leasing the operation of all three back to The Cordish Companies.

Successful setup:

Gaming and Leisure Properties Incorporated was born in November of 2013 as a spin off from Penn National Gaming Incorporated and currently owns 50 casinos across 17 American states including the 2,364-room Tropicana Atlantic City venue in New Jersey as well as Indiana’s more modest Belterra Casino Resort property. The Wyomissing-headquartered landlord held assets worth slightly over $9.28 billion at the end of September and saw its associated third-quarter net income swell by 17.2% year-on-year to surpass $149 million.

Thorough tenure:

As part of these fresh arrangements and Gaming and Leisure Properties Incorporated disclosed that it will be entering into new triple-net master leases with The Cordish Companies for the Live! Casino and Hotel Philadelphia and Live! Casino Pittsburgh developments in addition to a single asset lease for the Live! Casino and Hotel Maryland venue. The firm declared that all three of these deals are to feature initial 39-year terms while maxing out at 60 years ‘inclusive of tenant renewal options’ so as to allow the seller to ‘immediately lease back all the properties’ and continue to ‘own, control and manage all the gaming operations’ uninterrupted.

Rental rate:

Peter Carlino serves as the Chairman and Chief Executive Officer for Gaming and Leisure Properties Incorporated and he used the press release to disclose that the compacts include an aggregated $125 million annual rental promise complete with a fixed 1.75% yearly escalator. The boss pronounced that this new alliance additionally embraces a binding arrangement that is to see his firm work with The Cordish Companies ‘on future casino developments’ on top of ‘potential financing partnerships’ in areas such as its partner’s ‘portfolio of real estate and operating businesses.’

Read a statement from Carlino…

“These new leases are expected to have strong rent coverage at an accretive cap rate while further expanding and diversifying our portfolio and marking a continuation of our strategy to build an industry-leading and high-quality tenant roster. In addition to the real estate transaction for the three properties, we are excited to partner with The Cordish Companies on a range of future strategic opportunities that can leverage the financial and real estate development strengths and resources of both companies.”

Abiding appreciation:

For his part and the Chairman for Baltimore-headquartered The Cordish Companies, David Cordish, proclaimed that his company has been a long-time admirer of the ‘pioneering structure and accomplishments as a public platform’ of Gaming and Leisure Properties Incorporated and is now ‘delighted’ to have inked a formal arrangement that ‘aligns two recognized leaders in their respective industries.’

Cordish’s statement read…

“Live! is an iconic brand and our commitment to our customers, team members and local communities as top priorities will continue unabated. We look forward to continue delivering quality entertainment experiences in the markets we serve now and collaborating and partnering with Gaming and Leisure Properties Incorporated on opportunities to grow the Live! brand in the future.”