Just last month, Century Casinos made an announcement. It stated that it had entered an agreement to buy the Rocky Gap Casino Resort. The purchase would see Century Casinos taking over from the current owner, Lakes Maryland Development LLC. The fee for this acquisition is believed to be set at $56 million. Showing just how successfully Century Casinos has been, it is using cash from its balance sheet to go ahead and fund the purchase. With $56 million to play with, you can be sure that Century is posting some seriously healthy accounts. It’s not just Century that has entered the picture though. As we’ll see, VICI Properties Inc is set to play a major role in the future of the Rocky Gap Casino Resort too. Let´s take a closer look at the VICI Rocky Gap deal.
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A $204 million real estate deal – VICI Rocky Gap Deal
As soon as the transaction between Lakes Maryland and Century completes, there will be another transaction that completes simultaneously. This will see an affiliate of VICI Properties Inc, purchasing the real estate estates for an impressive $204 million. An amendment to the lease means that the annual rent for the Rocky Gap Casino will be $15.5 million.
The purchase price has been set as a 4.9 multiple of the earnings of 2021. Given that many land-based operations have experienced dips in their earnings as they are still coming out of the pandemic, it could well be that the price paid here is seen as somewhat of a bargain.
What this deal means for Century Casinos
According to the company’s Co-Chief Executive Officers, Erwin Haitzmann and Peter Hoetzinger, adding Rocky Gap to the group is a huge milestone as the company seeks to acquire other promising US assets. The acquisition of Rocky Gap isn’t happening in isolation. At the same time, the company is awaiting the completion of a deal to take over the Nugget Casino Resort in Nevada. What this means for Century, is that it will now have operations that span from east to west.
Of course, before things can be up and running smoothly, there is a need for Century to work with the Maryland Lottery and Gaming Control Agency to get the relevant approvals in place. The hope is that there will be no stumbling blocks here and the transition will be a smooth one.
A closer look at the VICI Rocky Gap Deal
The Rocky Gap Casino Resort is situated in Flintstone, Maryland, within the Rocky Gap State Park. This park attracts more than half a million visitors every year and that makes it a great location for a casino.
The resort can be found sitting within 270 acres of land and this includes an 18-hole golf course that was designed by Jack Nicklaus. There are also numerous meeting spaces, a 5,000-square-foot events centre, a spa and a selection of outdoor activities. Of course, what matters for many casino fans is the games that are to be found inside.
Those looking for a great casino experience won’t be disappointed. The property has an impressive 25,000-square-foot gaming floor. This space means that there’s an impressive range of games and attractions. These include:
- 630 slots
- 16 table casino games
- 198 hotel rooms
- Five food and drink venues
All of this added up to bring in $78 million worth of revenue for the year ending December 2021.
There are lots to be positive about when it comes to the Rocky Gap and it’s clear to see why Century and VICI will be pleased to have snapped it up. It has already had a recent $10 million investment that brought improvements to the hotel, spots lounge, slot machines and restaurants. Beyond this, there is also the potential to expand the casino and increase the customer base even further.
Something worth watching is whether or not Century will bring sports betting to the Rocky Gap. There is certainly the opportunity to partner with a sports betting operator if that’s something that it decides to pursue.
A closer look at VICI Properties
If you’ve yet to come across VICI Properties, there’s a good chance that you’ve stepped foot in one, or more, of their buildings without even realising it. The company is an S&P 500 one and it specialises in investing in properties. It has one of the latest portfolios in the country when it comes to hospitality, gaming and entertainment destinations. Just some of the properties owned by VICI include:
- Caesars Palace Las Vegas
- MGM Grand
- Venetian Resort Las Vegas
These are some of the most iconic casinos in the country, but they hardly scratch the surface when it comes to the full portfolio owned by VICI. Under its belt, it has an impressive 43 gaming facilities that cover over 122 million square feet and have around 58,700 hotel rooms. There are also over 450 restaurants, bars, nightclubs and sportsbooks. Its properties are all leased to leading operators in gaming and hospitality.
VICI aims to be behind the country’s highest quality and most productive experiential real estate portfolio.
A great place for Century to be
Once Century completes on both the Nugget and Rocky Gap deal, it will put itself into an extremely strong position. It will see the company’s North American portfolio hit 11 casinos. Those 11 casinos offer an impressive total of 7,140 gaming machines and 158 table games.
There are still regulatory and governmental approvals to overcome before these deals can close, but there are no problems anticipated. In fact, the deals are set to close in mid-2023.
Final thoughts on the VICI Rocky Gap Deal
The acquisition of the Rocky Gap Casino Resort is great news for both Century Casino and VICI Properties Inc. For the former, it really establishes the company as a force to be reckoned with a strong foothold in North America. For the latter, this is just yet another example of how the company is heading for dominance in terms of owning the top destinations across the US. The good news is that this is all positive as far as the player experience is concerned.
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