VICI Properties Acquires Remaining Stake In MGM Grand Las Vegas and Mandalay Bay JV For $1.3B Cash Plus Debt

  • VICI Properties Inc VICI, an experiential real estate investment trust, announced that its CEO Edward Pitoniak recently announced the acquisition of the remaining 49.9% interest in the MGM Grand Las Vegas and Mandalay Bay joint venture.
  • VICI currently owns a 50.1% interest in the joint venture that owns MGM Grand Las Vegas and Mandalay Bay Resort.
  • VICI agreed to acquire Blackstone Real Estate Income Trust, Inc's ("BREIT") 49.9% interest for $1.27 billion cash and VICI's assumption of BREIT's pro-rata share of the existing property-level debt
  • The property-level debt has a principal balance of $3.0 billion, matures in 2032, and bears interest at a fixed rate of 3.558% per annum through March 2030.
  • The properties, situated at the south end of the Las Vegas Strip in Las Vegas, Nevada, are subject to an existing triple-net lease agreement between the joint venture and MGM Resorts International MGM.
  • The lease will generate annual rent of $310 million upon the commencement of the following rental escalation on March 1, 2023.
  • VICI Properties intends to fund the transaction through a combination of cash on hand, proceeds from the settlement of existing outstanding forward equity sale agreements, and the assumption of the remaining 49.9% of the existing property-level debt. 
  • VICI expects the transaction to be immediately accretive to AFFO per share upon closing.
  • VICI held $1.7 billion in cash and equivalents as of September 30. Traditional net debt was $989.5 million.
  • In November, VICI raised $509.9 million via a secondary stock offering for funding acquisition.
  • Price Action: VICI shares traded lower by 0.37% at $33.75 on the last check Friday.
  • Photo via Wikimedia Commons
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