The billionaire businessman behind American casino operator, Jack Entertainment, has reportedly agreed a deal that is to see his firm sell off Detroit’s Greektown Casino Hotel property to a pair of regional rivals for $1 billion.
Pair of buyers:
According to a Wednesday report from the Detroit Free Press newspaper, Dan Gilbert (pictured) serves as Chairman for Detroit-headquartered Jack Entertainment and has now signed off on the sale involving Penn National Gaming Incorporated as well as the Vici Properties Incorporated real estate investment trust (REIT) spun off from Caesars Entertainment Corporation last year.
The newspaper reported that 56-year-old Gilbert established Jack Entertainment in 2009 before brokering a $600 million deal some four years later that saw his firm acquire the 400-room Greektown Casino Hotel from the Sault Ste Marie Tribe of Chippewa Indians. The Detroit native is worth an estimated $7.8 billion thanks to his Quicken Loans Incorporated mortgage lending business and moreover owns the Cleveland Cavaliers franchise of the National Basketball Association (NBA).
Proceeds to fund other projects:
Gilbert reportedly told the newspaper via a telephone interview that the transaction does not involve any of Jack Entertainment’s other gambling properties, which include Ohio’s Jack Cleveland Casino and Jack Cincinnati Casino, and that he intends to use any proceeds to support some of his many other development projects in and around Detroit.
In-debt venue performing well:
The newspaper also reported that Greektown Casino Hotel is currently carrying debts of around $400 million although official figures from the Michigan Gaming Control Board show that the venue posted a 6.6% increase year-on-year in October revenues to $27.6 million. Last month additionally saw the 30-story downtown property post a 24% market share behind area rivals MotorCity Casino Hotel and MGM Grand Detroit while its overall earnings for last year amounted to just over $329.7 million.
Gilbert told the Detroit Free Press…
“It frees up significant capital to invest in our large developments that we’ve started and some are about to start soon. We’re going to focus on business development and technology, start-up scene in Detroit and things like StockX and other exciting businesses that will create jobs and excitement and attract people to the city from all over.”
Deal to be completed for 2020:
The Detroit Free Press reported that Greektown Casino Hotel has some 1,800 employees and features numerous restaurants and bars alongside a casino with 2,800 gaming machines, dozens of gaming tables and a poker room. Gilbert told the publication that he expects the sale of the Michigan property to close by the end of next year despite the prospect of ‘significant regulatory hurdles’.
“We don’t foresee or expect significant issues, if any, but you never know in this world.”
Prestigious new ownership:
Regarding the prospective new owners, the newspaper reported that Vici Properties Incorporated is an independent and publicly-traded vehicle that was created as a result of Caesars Entertainment Corporation’s bankruptcy reorganization. The Las Vegas-headquartered enterprise owns 20 casinos spread across the United States including Indiana’s Horseshoe Hammond as well as the giant Caesars Palace Las Vegas.
For its part, Penn National Gaming Incorporated styles itself as ‘North America’s largest regional gaming operator’ with the Wyomissing-based operator responsible for some 40 properties including the nearby Hollywood Casino Toledo alongside the more distant Hollywood Casino Columbus.