The Michigan Gaming Control Board recently voted unanimously to approve the $1 billion sale of Greektown Casino-Hotel in downtown Detroit, owned by Dan Gilbert’s Jack Entertainment, to Penn National Gaming and the real estate investment trust VICI Properties. The all-cash deal, announced last November, closed May 23; the city of Detroit and the Federal Trade Commission previously approved the transaction.
Greektown ranks third in revenue the Detroit casino market, after Motor City Casino Hotel and market leader MGM Grand Detroit. Penn National Gaming Chief Executive Officer Timothy Wilmott said, “The fact that we’re the smallest casino of the three certainly gives us opportunities for improvement.” He said Penn National has no immediate plans to make any physical changes to the casino.
However, a new general manager, John Drake, will be brought in. “We want to learn a little about the business as we work with team members there and understand what the customers are looking for in additional amenities before we start talking about any improvements,” Wilmott said.
Under the deal, Penn National will acquire Greektown Casino-Hotel operations for $300 million and VICI will buy the casino property’s real estate for $700 million, then lease it to a Penn National subsidiary.
Last fall, reports indicated Greektown carried about $400 million in debt. But Wilmott said Gilbert’s team has been running the casino profitably; the property was losing money when Gilbert and his partners bought it in 2013. The casino was in bankruptcy from 2008 to 2010.
Wilmott added Penn National is closely following sports betting legislation in Michigan. The company operates casinos in Pennsylvania, West Virginia and Mississippi where sports betting is allowed. ”It’s proven to be a very nice amenity. It brings in a new group of customers, and we’re seeing a lot of increased visitation around sports betting” Wilmott said.
