Gaming and Leisure Properties acquires Tioga Downs Casino Resort in $175M deal

Gaming and Leisure Properties has made a notable acquisition, announcing the purchase of the real estate assets of Tioga Downs Casino Resort in Nichols, NY, from American Racing & Entertainment for $175 million. The acquisition is part of a broader strategy by GLPI to diversify its portfolio and strengthen its position in the gaming and entertainment sector.

Simultaneous with the acquisition, GLPI and American Racing have entered into a triple-net master lease agreement for an initial 30-year term. Under this agreement, GLPI will lease the property back to American Racing, with an initial annual rent of $14.5 million, representing an 8.3% capitalization rate. The lease terms also include fixed annual escalations to ensure sustainable growth over the lease period.

Tioga Downs Casino Resort, nestled in Nichols, NY, spans roughly 162 acres and boasts a range of amenities, including a 32,600 sq. ft. gaming floor with 895 slots and 29 table games, a 2,500 sq. ft. FanDuel sports book, a 160-room hotel, a 5/8-mile harness horse track, 7 food and beverage locations, and an 18-hole championship golf course.

The property underwent a $130 million expansion starting in 2016 after being granted a Class III casino license by the State of New York.

GLPI's Chairman and CEO, Peter Carlino

GLPI's Chairman and CEO, Peter Carlino, expressed his satisfaction with the acquisition, stating: "We are pleased to add Tioga Downs to our portfolio and the new relationship with American Racing to our tenant roster. Tioga Downs further diversifies our portfolio, expanding it to 62 properties across 19 states with 8 tenants."

"American Racing has 20 years of gaming, horse racing, and hotel experience, marking another addition to our portfolio of leading gaming operator tenants," he added.

 Jeff Gural, American Racing's Founder and CEO, echoed this sentiment: "We are excited to partner with the team at GLPI as we continue to grow our business at Tioga Downs."

The transaction was financed through a combination of cash on hand and the issuance of $20.0 million in OP units. GLPI has also utilized its ATM program, issuing 4.06 million shares since the end of the third quarter of 2023, raising net proceeds of $188.9 million, part of which was allocated towards funding this acquisition and the company's ongoing acquisition pipeline.

Citizens JMP Securities acted as the financial advisor to Gaming and Leisure Properties, while Innovation Capital served as the financial advisor to American Racing.