Gaming & Leisure Properties Inc. (GLPI) a real estate Investment trust (REIT) spin-off of Penn National Gaming, has acquired Meadows Racetrack & Casino, a racino in Washington, PA near Pittsburgh. An announcement on NASDAQ confirmed that a lawsuit filed by GLPI had been settled with a final purchase price of $440 million.
GLPI had sued former owners, Cannery Casino Resorts, LLC saying that the previously negotiated purchase price was arrived at due to an overstating of the property’s financial performance. The settlement allows the purchase to conclude in the second half of 2016 pending approval by the Pennsylvania Gaming Control Board and the Pennsylvania Harness Racing Commission.
GLPI is seeking a third party operator to purchase the property’s licenses and operating assets, but plans to retain the land and buildings.
Meadows Casino opened in 2007 and has over 3,000 slot machines, 74 table games and 14 poker tables. In addition to the attached 5/8 mile harness racing track and grandstand, other amenities include 11 dining venues, bars and lounges, and a 24 lane bowling alley. A physically linked 154 room Hyatt Place hotel that opened next to the casino in April is owned and operated by a 3rd party.
GLPI is a spin-off of Penn National Gaming created in November 2013. Before acquiring 15 properties from Pinnacle Entertainment earlier this year, GLPI owned 20 casinos, 18 of which were operated by Penn. The real estate investment trust vehicle was created to take advantage of a loophole which allows REIT’s to avoid paying corporate income taxes as long as most of the revenue is returned to shareholders. REIT’s must pay out 90% in dividends to shareholders.
Cannery Casino Resorts, LLC was established in 2001. The company owns and operates the Cannery Casino & Hotel in North Las Vegas; and Eastside Cannery Casino & Hotel in Las Vegas, Nevada.