JACK Entertainment announced on Friday that it has completed the sale of its JACK Cincinnati Casino for $745 million. It is a two-part sale: VICI Properties acquired a JACK subsidiary that owns the land and real estate assets of the casino and Hard Rock International will take over the operations of the property.

JACK Entertainment Closes $745M Deal on Cincinnati Casino to Hard Rock International, VICI Properties. Posted on: September 22, 2019, 12:20h. Last updated on: September 22, 2019, 06:14h. While the article mentioned former Gilbert partner Caesars as a potential bidder for the properties including the Jack Casino in Downtown Cleveland and Jack Thistledown Racino in nearby North. Excitement of the casino to the comfort of your home! 756-8248 International / Local: 513-469-6486 100 Office Park Drive, Fairfield (Cincinnati) OH 45014.

Buy and rent

The portion of the sale price that VICI Properties shelled out was $558 million cash. VICI then entered into a triple-net lease with Hard Rock in which Hard Rock will pay $42.75 million rent per year for 15 years. After the initial lease term is up, Hard Rock can up to renew for five years as many as four times. In a triple net lease, the tenant (Hard Rock), takes care of building maintenance, real estate taxes, and insurance in addition to paying rent.

It may sound like a weird deal for Hard Rock, but by taking on those expenses, the total costs per year when combined with rent are likely less than what VICI would have charged for rent without the expenses. And Hard Rock will operate the property, therefore making money off of it like it would if it owned it. VICI, while maybe not getting as much as it could in rent if it took on the added expenses, gets a stable revenue stream for as much as a quarter of a century.

Hard Rock acquired the gaming assets of the casino for $187 million, bringing the total payment to JACK Entertainment to the aforementioned $745 million.

Executives gush

“We are pleased to officially welcome Hard Rock International and its world-renowned brand to the Queen City,” said Mark Dunkeson, Chief Executive Officer of JACK Entertainment, in a press release. “After ten years and hundreds of millions of dollars of investment developing JACK Cincinnati Casino from the ground up, we are confident that the property’s success will continue into the future as Hard Rock International takes it to the next level of growth.”

Dunkeson also thanked the casino staff for their hard work, adding, “We know they will continue to thrive under Hard Rock International’s leadership as they are known for their excellent culture.”

In addition to years of cash flow, VICI President and COO John Payne was thrilled with the deal, saying the company is “diversifying our geographic exposure by acquiring one of only four full-scale casino properties in the limited license state of Ohio, which continues to be one of the healthiest and fastest growing regional gaming markets across the country.”

JACK and VICI have a history

This is the second transaction between JACK Entertainment and VICI Properties to close this year as JACK Entertainment reduces its presence in the gaming industry. In May, it completed the sale of the Greektown Casino-Hotel, one of three casinos in Detroit. The deal was announced in November 2018.

In that sale, VICI Properties bought the land and real estate for $700 million, while Penn National Gaming acquired the operations of Greektown Casino-Hotel for $300 million, bringing the total deal to $1 billion.

Like with the JACK Cincinnati acquisition, VICI entered into a triple-net lease agreement with Penn National. The lease timeframe and renewal options are the same with annual rent of $55.6 million.

JACK Entertainment announced on Friday that it has completed the sale of its JACK Cincinnati Casino for $745 million. It is a two-part sale: VICI Properties acquired a JACK subsidiary that owns the land and real estate assets of the casino and Hard Rock International will take over the operations of the property.

Buy and rent

The portion of the sale price that VICI Properties shelled out was $558 million cash. VICI then entered into a triple-net lease with Hard Rock in which Hard Rock will pay $42.75 million rent per year for 15 years. After the initial lease term is up, Hard Rock can up to renew for five years as many as four times. In a triple net lease, the tenant (Hard Rock), takes care of building maintenance, real estate taxes, and insurance in addition to paying rent.

It may sound like a weird deal for Hard Rock, but by taking on those expenses, the total costs per year when combined with rent are likely less than what VICI would have charged for rent without the expenses. And Hard Rock will operate the property, therefore making money off of it like it would if it owned it. VICI, while maybe not getting as much as it could in rent if it took on the added expenses, gets a stable revenue stream for as much as a quarter of a century.

Hard Rock acquired the gaming assets of the casino for $187 million, bringing the total payment to JACK Entertainment to the aforementioned $745 million.

Executives gush

“We are pleased to officially welcome Hard Rock International and its world-renowned brand to the Queen City,” said Mark Dunkeson, Chief Executive Officer of JACK Entertainment, in a press release. “After ten years and hundreds of millions of dollars of investment developing JACK Cincinnati Casino from the ground up, we are confident that the property’s success will continue into the future as Hard Rock International takes it to the next level of growth.”

Dunkeson also thanked the casino staff for their hard work, adding, “We know they will continue to thrive under Hard Rock International’s leadership as they are known for their excellent culture.”

In addition to years of cash flow, VICI President and COO John Payne was thrilled with the deal, saying the company is “diversifying our geographic exposure by acquiring one of only four full-scale casino properties in the limited license state of Ohio, which continues to be one of the healthiest and fastest growing regional gaming markets across the country.”

JACK and VICI have a history

Jack Ohio Casino Sales Tax

This is the second transaction between JACK Entertainment and VICI Properties to close this year as JACK Entertainment reduces its presence in the gaming industry. In May, it completed the sale of the Greektown Casino-Hotel, one of three casinos in Detroit. The deal was announced in November 2018.

In that sale, VICI Properties bought the land and real estate for $700 million, while Penn National Gaming acquired the operations of Greektown Casino-Hotel for $300 million, bringing the total deal to $1 billion.

Jack Ohio Casino Salem

Like with the JACK Cincinnati acquisition, VICI entered into a triple-net lease agreement with Penn National. The lease timeframe and renewal options are the same with annual rent of $55.6 million.