Gaming and Leisure’s $100M land deal beneath Hard Rock Casino Project

Content Team August 31, 2023

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Gaming and Leisure’s $100M land deal beneath Hard Rock Casino Project

Gaming and Leisure Properties (NASDAQ: GLPI) announced on Tuesday its acquisition of the land beneath the upcoming Hard Rock Casino project in Rockford, Illinois. The land was purchased from an affiliate of 815 Entertainment for $100 million.

GLPI’s land deal

As part of the deal, GLPI also entered a ground lease agreement with 815 Entertainment for a duration of 99 years. The initial annual rent for this lease stands at $8 million, with a fixed annual increase of 2.0%, beginning on the first anniversary of the lease and continuing throughout its entirety.

Following this news, GLPI’s stock experienced a 1.0% decline during after-hours trading on Tuesday.

Furthermore, Gaming and Leisure Properties has committed to providing potential development funds, amounting to a maximum of $150 million. These funds would be extended through a senior secured delayed draw term loan.

Should any funds be borrowed under this loan, they will be subject to a 10.0% interest rate. The term of the loan allows for a draw period of up to one year, with a maximum outstanding period lasting six years (consisting of an initial five-year term with the option of a one-year extension). Importantly, the loan can be repaid without penalties following the anticipated opening of the Hard Rock Casino in Rockford, Illinois, scheduled for September 2024.

As an additional aspect of the agreement, GLPI will gain a right of first refusal concerning any potential future sale of completed casino building improvements. This further cements the company’s involvement in the development.

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