Sale subject to regulatory approval
Caesars Entertainment and VICI Properties have agreed to sell Bally’s Atlantic City Hotel & Casino to Twin River Worldwide Holdings in an all-cash deal worth $25m.
VICI Properties will bank $19m and Caesars will receive the final $6m
Regulators must approve this sale and other closing conditions need to be met. If the sale goes through, VICI Properties will bank $19m and Caesars will receive the final $6m. The annual payment for base rent, as per the master lease agreed between VICI Properties and Caesars, will not change.?
Reaction to the all-cash deal
In a press release announcing the sale, Caesars Entertainment CEO Tony Rodio spoke about the great future that awaits the property under the stewardship of Twin River.
VICI Properties COO and president John Payne talked about the company’s continuing commitment to work together with tenants to improve operations following the announcement of this sale.
Looking to other projects in the area, Payne said: “This transaction allows us to maintain the existing financial terms of our master lease with Caesars and helps balance our geographic diversification as we work to complete the acquisition of Harrah’s Resort Atlantic.”
Caesars not going anywhere
After the completion of this sale, Caesars will continue to operate the sportsbook and casino at Caesars Atlantic City, as well as Harrah’s Resort Atlantic City. VICI Properties remains the real estate owner of the Caesars Atlantic City property.?
Coronavirus impact
The sale of Bally’s Atlantic City was completed despite the ongoing coronavirus pandemic. Casinos in Atlantic City have been closed since March 16. This was only the fifth time ever that New Jersey casinos have been forced to shut in the sector’s 42-year history. The last time was during Hurricane Sandy in 2012.
New Jersey government is losing out on about $540m in tax revenue each month
There are concerns about the longevity of the casinos in Atlantic City with closures set to continue for the foreseeable future. The New Jersey government is losing out on about $540m in tax revenue each month that casinos remain shut. Over 26,000 workers in the city are also without work.
As a result of the widespread casino shutdowns across the country, Caesars furloughed about 90% of its 64,000 employees.