Vici Properties has disclosed a third international investment after entering into definitive agreements to purchase the real estate assets of a quartet of gaming establishments in a sale and leaseback arrangement.
This will see the real estate investment trust acquire Alberta’s Century Casino & Hotel Edmonton, Century Casino St. Albert, Century Mile Racetrack and Casino, and Century Downs Racetrack and Casino from Century Casinos for C$221.7m (US$164.7m) in cash.
The transaction is subject to customary regulatory approvals and closing conditions and is expected to close in the second half of 2023.
This comes after the group pulled the trigger on a maiden international investment in January, which also came via the purchase of four gaming properties located in Alberta for C$271.9m (US$200.8m). This, at the time, saw Pure Canadian Gaming added as an eleventh tenant.
The purchase will see Vici Properties add a combined 69,360 square feet of gaming space that boast 2,443 slots and 78 VLTs.
John Payne, President and Chief Operating Officer of Vici Properties, said, “We are thrilled to announce our third international investment with the acquisition of Century’s four Canadian casino assets, demonstrating our ongoing desire to expand internationally and confidence in the Canadian gaming market.
“We are also pleased to continue growing our partnership with Century by supporting their asset monetisation strategy, unlocking value that fuels their strategic growth initiatives.”
Upon closing, the Century Canadian venues will be added to an existing triple-net master lease agreement, which will see annual rent increase by C$17.3m (US$12.8m) to represent an implied acquisition capitalisation rate of 7.8 per cent.
Furthermore, the lease will also be extended to have a full 15-year initial base lease term, with four five-year tenant renewal options also included.