Wynn Resorts confirmed that it has completed the previously announced sale/leaseback arrangement for its Encore Boston Harbor property. The company sold the resort’s real estate to Realty Income, a real estate investment trust, for $1.7 billion.
Wynn will lease the property for 30 years at a rate of $100 million per year, and maintain all operations. Under the terms of the agreement, rent will increase at a rate of 1.75 percent for the first decade, and the greater of that percentage or the consumer price increase over the remaining 20 years. The deal comes in at a cap rate of 5.9 percent. It is Realty Income’s first lease agreement in the gaming industry.
According to Wynn Resorts, proceeds from the deal will improve its liquidity position, which currently stands at $4.4 billion.
