Caesars Palace landlord reports 19% revenue increase

Some in the gaming industry are still seeing strong revenue results amid the COVID-19 pandemic.

Caesars Entertainment Corp.-affiliated real estate investment trust Vici Properties Inc. reported a 19 percent increase in net revenue Thursday compared with last year, earning $255 million in the first quarter.

The REIT acts as landlord for a number of properties, including some owned by Caesars and Penn National Gaming, and was recently named the third-largest American triple net REIT by enterprise value. Its portfolio includes 28 gaming facilities — including Caesars Palace in Las Vegas — with roughly 15,600 hotel rooms and more than 180 restaurants, bars and nightclubs.

The company is poised to lose at least one of its assets; last week, Caesars said it would sell Bally’s Atlantic City and its real estate for $25 million in cash as it prepares to close its merger with Eldorado Resorts. Vici is set to receive $19 million from the sale.

CEO Edward Pitoniak said the pandemic has resulted in “significant uncertainty” for its tenants, but it is working with them to monitor and manage responses to various reopening scenarios, according to a Thursday filing with the Securities and Exchange Commission.

The filing said all of Vici’s tenants paid rent in full for the month of April, but the company is in discussions with five tenants on how to best respond to the pandemic’s effects on finances and operations.

“While we have not yet agreed to any lease modifications or other concessions with any of our tenants, if the current environment persists, we may ultimately support tenants during the short term in ways that we believe will benefit the Company over the long term,” the statement reads.

The filing said Eldorado continues to pursue the regulatory approvals needed to close the acquisition, and Vici has raised all equity and debt funding necessary to close on its part of the transaction.

The company has over $300 million in cash, and $6.9 billion in total debt as of March 31.

Shares closed down 2.7 percent on Thursday at $17.42 per share. The company will hold its first-quarter earnings call Friday morning.

Contact Bailey Schulz at bschulz@reviewjournal.com or 702-383-0233. Follow @bailey_schulz on Twitter.