LAS VEGAS — Caesars Entertainment Corporation has completed its deal to sell and leaseback the real estate assets associated with Harrah’s Las Vegas, and to acquire adjacent land from VICI Properties to develop a planned new convention centre.
Caesars Entertainment received US$1.14 billion in cash in return for Harrah’s Las Vegas’ real estate assets and acquired 18.4 acres of adjacent land as part of the convention center agreement.
“The successful closing of these transactions marks the latest step in our diversified growth strategy,” said Mark Frissora, President and Chief Executive Officer of Caesars Entertainment. “The proceeds of the sale of Harrah’s Las Vegas will be used to partially fund the previously announced acquisition of Centaur and is expected to allow us to develop the convention center without increasing leverage. In addition, the transactions will allow us to maintain Harrah’s Las Vegas’ connectivity to our network, while pursuing our plans to develop another important destination right in the middle of our centre-Strip footprint.”
Caesars Entertainment will continue to operate Harrah’s Las Vegas, including gaming, hotel operations and all other amenities. The property will remain a part of the Caesars Entertainment network and continue to benefit from the Harrah’s brand, the Total Rewards loyalty network and access to centralized services. The sale and leaseback transaction expands the recently formed relationship between Caesars Entertainment and VICI Properties. As part of the sale and leaseback transaction, Caesars and VICI will enter into a 15-year lease for Harrah’s Las Vegas under which Caesars will pay initial annual rent of $87.4 million. The rent will increase contractually in subsequent years. Caesars will have the option to extend the lease for an additional 20 years via four five-year extensions.
The planned convention center is expected to feature 300,000 square feet of flexible meeting space. It will have the largest column-free ballroom in the United States, state-of-the-art technology and flexibility to accommodate meetings of many different sizes. The conference space is expected to accommodate more than 10,000 attendees and include an outdoor plaza.
