VICI Properties has entered into a lease agreement with Cherokee Nation Business (CNB), the Tribally-owned holding company of the Cherokee Nation. This agreement relates to its acquisition of the operations of Gold Strike Casino Resort in Mississippi.
VICI has entered into a triple-net lease agreement with CNB with regard to the real property assets associated with Gold Strike.
The company’s COO and President John Payne commented: “We are excited to partner with CNB in Tunica and look forward to supporting the team as they grow their gaming and hospitality businesses.”
The initial total annual rent under the lease is $40m and the lease has an initial term of 25 years that comes with options for three separate 10-year tenant renewals. The triple-net lease has a rent rate that will escalate by 2% annually, which will be capped at 3% in the eleventh year of the lease.
Annual base rent payments will be made under VICI’s master lease with MGM Resorts, which have been reduced by $40m, to a total of $730m. These reductions have been made to account for MGM’s divestiture of the operations of Gold Strike.
MGM sold Gold Strike Tunica operations for $450m last June, to Cherokee Nation Entertainment Holdings, a subsidiary of CNB. At the time of the sale, MGM CEO and President Bill Hornbuckle commented: “Gold Strike is a wonderful property with a bright future ahead.
“Strategically, though, we decided to narrow our focus in Mississippi to a single resort – Beau Rivage – and dedicate more of our time and resources towards continuing to drive success at that leading, world-class resort and casino.”
VICI’s obligations under the lease are guaranteed by CNB. which is based in Oklahoma and is the largest Native American Tribe in the US.
