After agreeing to sell off its Detroit Greektown Casino Hotel property in mid-November, Jack Entertainment LLC has now revealed a deal that will see its Cincinnati casino and Thoroughbred racetrack in Florence, Kentucky acquired by Hard Rock International and Vici Properties Inc.
The $780 million sale, which is subject to approvals at both federal and state levels, is the Detroit-based gaming, hospitality, and entertainment corporation’s second divestiture of gambling venues within the past six months.
“We look forward to introducing our unique brand of casino entertainment to Cincinnati“
According to the Friday announcement from Jack Entertainment…
The signing of multiple contracts followed a “strategic assessment” of the Dan Gilbert-owned company‘s business portfolio. It includes the sale of its JACK Cincinnati Casino property in Ohio, alongside its Thoroughbred racetrack in Northern Kentucky, Turfway Park to NYC-headquartered real estate investment trust (REIT), VICI Properties, and Seminole Hard Rock Entertainment, Inc. subsidiary, Hard Rock International.
The New York-based REIT, spun off from Las Vegas-based Caesars Entertainment Corp., will at the same time enter into a “triple-net leased fee agreement” with Hard Rock International, which will operate both the Ohio and Kentucky properties and will rebrand the former, Hard Rock Casino Cincinnati.
According to the news release, neither JACK Thistledown Racino or JACK Cleveland Casino will be affected by the transaction, and the company ‘remains committed to investing in and operating these properties.’
“establishing a strong customer focused culture“
Chief Executive Officer for Jack Entertainment, Matt Cullen, said…
“We viewed the gaming industry as a catalyst for economic development in our local communities. After ten years, hundreds of millions of dollars of investment developing JACK Cincinnati Casino from the ground up, and establishing a strong customer focused culture, we have successfully positioned JACK Cincinnati Casino for further future success.
“We are confident that Hard Rock and its world-renowned brand will be a great addition to the Queen City and the right choice to take JACK Cincinnati Casino and Turfway Park to the next level of growth. We chose to sell to Hard Rock, in large part, due to its great culture and quality of its leadership. They are an outstanding operator that JACK Cincinnati Casino and Turfway Park team members will enjoy working with as they continue to deliver excellent service to our guests,” he added.
Crain’s Detroit Business reports that the November 2018, $1 billion cash deal Jack entered into with Wyomissing, Pennsylvania-based gaming conglomerate, Penn National Gaming Inc. and Vici Properties, to acquire Greektown Casino-Hotel in Detroit has yet to close, according to a Friday email from Samantha Chyette, the firm’s senior communications manager.
According to a September 5, 2018, Bloomberg report, billionaire Gilbert, who also owns the Cleveland Cavaliers professional basketball team and is the founder of Quicken Loans Inc., is looking to get out of the casino business, something reportedly communicated by those familiar with his plans.
Acting as financial advisers on the sales are Credit Suisse Securities (USA) LLC and Deutsche Bank Securities Inc. and legal adviser to Jack Ohio LLC and its affiliates is Paul, Weiss, Rifkind, Wharton & Garrison LLP.
The Detroit-based company owned by Gilbert has interests in half-a-dozen casinos and racetracks in Ohio and the Greektown Casino-Hotel in Detroit (until the sale is finalized), which the 57-year-old acquired in 2013.
According to the Ohio Casino Control Commission, the Cincinnati casino generates nearly $200 million annually in gambling revenue. And the 22-acre property features 100,000 sq ft of gaming space with 100 table games and 1,800 gaming machines. Situated in the Broadway Commons area of Downtown, the property also includes six restaurants, two bars and 33,000 sq ft of meeting and event space.
No word on upgrades:
While it’s unclear what upgrades, including a potential hotel, the company will be making to the Ohio property, Chairman and Chief Executive Officer for Hard Rock International, Jim Allen, said…
“Hard Rock has been the number one operator in Ohio since opening in the greater Cleveland market in 2013.
“And now, we look forward to introducing our unique brand of casino entertainment to Cincinnati. On behalf of the 40,000 Hard Rock team members worldwide, I am pleased to welcome the more than 1,000 JACK Cincinnati employees into the Hard Rock family.”
Hard Rock will reportedly announce new property improvements later this year.