Casinos in the US have some of the priciest real estates in the Las Vegas area. In spite of that but are now investing in their real property more fervently. A new wave of mergers, acquisitions, and leaseback agreements are sweeping through Sin City and Atlantic City. According to research, the aforementioned deals have been more than a decade in the making. Many casinos that are involved in these mergers and acquisitions believe that investing in their land property is the most important aspect to unchaining hidden value.
Real Estate Restructuring Plan
Currently, throughout Las Vegas, in particular, casino operators are separating off the actual land where their massive entrainment multiplex lie. Essentially, they are just taking advantage of investors searching for income in a current economy of vastly low-interest rates in this bear market. Amongst the financial downturn, the Caesars Entertainment cooperation has been engaging in the most financial pursual by leveraging their property holdings. June 2019, saw Caesars Entertainment secure Eldorado Resorts, an indistinct casino in Reno, Nevada.
Many believe that this alliance was only possible by the Reit. The Reit is essentially a real estate investment trust which owns numerous lands and buildings in the Vegas strip. All of this came to be when Caesars Entertainment filed for bankruptcy in 2015. The hedge fund creditors at the time then appropriated control of Caesars Entertainment and restructured the company into two clear-cut public organizations.
Growth in the Casino Industry
This new environment has propelled valuations higher as well as an influx of further mergers and acquisitions. Additionally, MGM Resorts and Penn National Gaming and other various casinos have also now launched Reits. Research has indicated that these Reits have generated numerous properties and wealth as a direct result. Time will only reveal the risks associated with having a Reit.