Caesars Entertainment Corporation (NASDAQ:CZR) has completed the earlier reported deal to leaseback and sell the real estate assets linked with Harrah’s Las Vegas to “VICI” and to buy adjacent property from VICI to advance a planned new convention center. The company obtained cash of $1.14 billion in exchange for Harrah’s Las Vegas’ real estate properties and bought 18.4 acres of adjacent property as part of the convention center deal
Mark Frissora, the CEO and President of Caesars Entertainment, expressed that the successful closing of these deals marks the next step in their diversified growth plan. The sale proceeds from Harrah’s Las Vegas will be utilized to partially support the previously reported acquisition of Centaur Entertainment and is expected to enable them to advance the convention center without rising leverage.
Moreover, the transactions will enable them to keep up Harrah’s Las Vegas’ connectivity to their network, while following their plans to advance another vital destination right in the core of their Center-Strip footprint.
Caesars will continue to keep Harrah’s Las Vegas operational, including hotel operations, gaming and all other amenities. The asset will continue to be a part of the company network and continue to gain from the Harrah’s brand, access to centralized services and the Total Rewards loyalty network. The leaseback and sale deal expands the recently established association between VICI Properties and Caesars Entertainment. As part of the leaseback and sale deal, VICI and Caesars will finalize a 15-year lease for Harrah’s Las Vegas following which Caesars Entertainment will pay initial yearly rent of $87.4 million.
This rent will grow contractually in following years. The company will have the chance to extend the lease for another 20 years through four five-year extensions. Caesars reported that the planned convention center is projected to showcase 300,000 square feet of flexible meeting area.