There are more than 60 regional casinos in the U.S. that are owned by real estate investment trusts, and the REIT trend, under which companies own land and lease the properties to their affiliated operators to manage, has provided some measure of protection against reliance on quarterly net income results.
However, REITs have not been immune to the coronavirus shutdown, with many withdrawing original 2020 earnings guidance. Gaming and Leisure Properties, which became the first gaming REIT when it was spun off from Penn National Gaming in 2013, collected 98.6 percent of its April rent from 44 gaming properties operated by Penn, but when asked to assess rents for May and June by Gaming Today, CEO Peter Carlino would not discuss the possibilities.
“GLPI believes its collaborative and mutually beneficial outcome with Penn National provides us and our investor base greater visibility and predictability from rent receipts over the remainder of 2020,” Carlino told the publication. Penn National President and CEO Jay Snowden added, “As the global (coronavirus) health crisis continues to evolve, we are navigating through this unprecedented time for our company, our industry, and our nation.”
VICI Properties, spun off by Caesars Entertainment and the owner of land and buildings for casino properties managed by Caesars, Hard Rock International, Jack Entertainment, Penn National and Century Casinos, told the publication it too is dealing with unprecedented challenges, but like Carlino at GLPI, offered an optimistic overall outlook.
“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 company said.
