VICI Properties Inc. is a company focused on owning and acquiring gaming, hospitality, and entertainment destinations, operating under long-term triple-net leases . The company owns 93 experiential assets, including 54 gaming properties and 39 other experiential properties across the United States and Canada, with notable properties like Caesars Palace Las Vegas, MGM Grand, and the Venetian Resort on the Las Vegas Strip . VICI's properties are leased to leading operators in the gaming, leisure, and hospitality sectors, providing a highly predictable revenue stream with embedded growth potential . Additionally, the company owns four championship golf courses and has real estate debt investments that may convert into ownership of underlying real estate .
- Sales-Type Leases - Generates revenue through long-term leases of gaming, hospitality, and entertainment properties to leading operators, ensuring a stable and predictable income stream.
- Lease Financing Receivables, Loans, and Securities - Provides financial products related to real estate, contributing significantly to the company's revenue.
- Golf Operations - Owns and operates four championship golf courses, adding to the company's diverse portfolio of experiential assets.
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What went well
- VICI Properties' Las Vegas assets are performing strongly, with operators like MGM Resorts achieving 94% occupancy in Q3, demonstrating the resilience of the Las Vegas market.
- VICI has multiple pillars of growth, including real estate acquisitions, property partner growth funds, and experiential credit solutions, providing diverse opportunities for sustainable and consistent capital deployment.
- VICI is actively exploring expansion into off-strip Las Vegas locations, focusing on partnering with great operators and high-quality assets, which can drive future growth.
What went wrong
- Potential risks in the regional gaming market due to increased competition, cannibalization, and same-store sales declines. Executives acknowledge the need for discipline in investments and understanding operators' ability to compete profitably for market share over the next decade.
- Slowdown in the lower segments of the business, impacting both gaming and experiential partners. There is a falloff in the weaker consumer segment, which could affect growth and investments.
- Hesitancy to engage in tribal gaming opportunities may limit growth. VICI is cautious about idiosyncratic risks associated with tribal land transactions, potentially missing out on opportunities that competitors are pursuing.
Q&A Summary
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2025 Growth Outlook
Q: Will you focus on smaller deals or big acquisitions in 2025?
A: We remain confident in bringing both gaming and nongaming deals, big and small, to continue our growth profile in 2025. Despite the trade-offs in our strategy, we are working on exciting opportunities and aim to maintain our growth. -
Rate Volatility Impact
Q: Has recent rate volatility affected deal activity?
A: The volatility has caused indecision and inaction, affecting deal flow and underwriting. We hope conditions will calm down soon. -
Regional Gaming Underwriting
Q: Are you more conservative on regional gaming underwriting?
A: We are being thoughtful and disciplined, considering competition and potential new markets. Understanding operator quality and asset competitiveness is crucial. -
Off-Strip Vegas Opportunities
Q: Are you exploring off-strip Vegas acquisitions?
A: Yes, we've been meeting with operators in locals and downtown markets. There are fabulous assets, and we aim to partner with great operators to grow. -
Casino Real Estate Cap Rates
Q: Do Vegas trends impact casino real estate cap rates?
A: Cap rates depend more on capital market conditions than short-term operator performance. We feel confident about Las Vegas and our operators' ability to navigate challenges. -
Experiential Partners Performance
Q: How are your experiential partners performing?
A: Great Wolf's performance is solid, with some falloff in lower-end consumers. Cabot and Canyon Ranch continue to attract customers with unique offerings and high-quality service. -
Tribal Gaming Investments
Q: Any updates on tribal gaming investments?
A: We value partnering with American Tribal Nations but remain cautious due to idiosyncratic risks in on-tribal land transactions. We focus on understanding and pricing these risks appropriately. -
Election Impact on Gaming
Q: Any election ballot items affecting regional gaming?
A: It's relatively quiet this year, with some activity in Missouri, Arkansas, and Virginia regarding new casinos and online sports betting. -
Nongaming Sector Growth
Q: Are new relationships mainly in nongaming sectors?
A: Not necessarily; we see opportunities in both gaming and nongaming. While nongaming deals may be smaller, we continue to focus on growth across all sectors.
- Given the trend of new openings leading to unit growth and potential cannibalization in regional gaming markets, how are you adjusting your investment and underwriting criteria to mitigate risks associated with same-store sales declines?
- With the volatility in REIT capital market conditions and uncertainty in consumer economic conditions, how does VICI plan to sustain its capital allocation strategy and generate earnings growth if access to capital becomes constrained?
- As you look ahead to 2025, how do you balance the trade-offs between pursuing larger, potentially transformative deals versus more frequent, smaller transactions in both gaming and non-gaming spaces to drive meaningful earnings growth?
- Considering reports of slowness in the lower segments of the consumer spectrum, how might this impact your partners' willingness to reinvest or participate in your growth funds, and what strategies are you employing to address this challenge?
- Can you elaborate on your approach to acquiring gaming assets in off-strip Las Vegas locations, including the specific metrics like yield, coverage, and operator quality that you consider critical in evaluating these opportunities?
Q3 2024 Earnings Call
- Issued Period: Q3 2024
- Guided Period: FY 2024
- Guidance:
- AFFO (Adjusted Funds From Operations):
- Expected to be between $2.36 billion and $2.37 billion.
- On a per share basis, expected to be between $2.25 and $2.26 per diluted common share.
- The guidance excludes impacts from transactions not closed, interest income from loans without final draw structures, possible future acquisitions or dispositions, capital markets activity, or other nonrecurring transactions or items .
- AFFO (Adjusted Funds From Operations):
Q2 2024 Earnings Call
- Issued Period: Q2 2024
- Guided Period: FY 2024
- Guidance:
- AFFO:
- Expected to be between $2.35 billion and $2.37 billion.
- On a per share basis, expected to be between $2.24 and $2.26 per diluted common share.
- Based on the midpoint, expected year-over-year AFFO per share growth of 4.7%.
- The guidance excludes impacts from transactions not closed, interest income from loans without final draw schedules, possible future acquisitions or dispositions, capital markets activity, or other nonrecurring transactions or items .
- AFFO:
Q1 2024 Earnings Call
- Issued Period: Q1 2024
- Guided Period: FY 2024
- Guidance:
- AFFO:
- Expected to be between $2.32 billion and $2.355 billion.
- On a per share basis, expected to be between $2.22 and $2.25 per diluted common share.
- The guidance excludes impacts from transactions not closed, interest income from loans without final draw structures, possible future acquisitions or dispositions, capital markets activity, or other nonrecurring transactions or items .
- AFFO:
Q4 2023 Earnings Call
- Issued Period: Q4 2023
- Guided Period: FY 2024
- Guidance:
- AFFO:
- Expected to be between $2.32 billion and $2.355 billion.
- On a per share basis, expected to be between $2.22 and $2.25.
- Projected year-over-year AFFO per share growth of 4% based on the midpoint of the guidance .
- AFFO:
Competitors mentioned in the company's latest 10K filing.
- Other REITs
- Gaming companies
- Investment companies
- Private equity firms
- Hedge funds
- Sovereign funds
- Lenders
- Other private investors
These competitors are mentioned in the context of competing for real property investments and transaction opportunities in the gaming, hospitality, wellness, entertainment, and leisure sectors .
Recent developments and announcements about VICI.
Legal & Compliance
- VICI Properties Inc.: A Maryland corporation.
- VICI Properties L.P.: A Delaware limited partnership.
- Underwriters: J.P. Morgan Securities LLC, Wells Fargo Securities, LLC, Barclays Capital Inc., and Deutsche Bank Securities Inc.
- Trustee: UMB Bank, National Association.
- VICI Properties Inc. and VICI Properties L.P. are involved in the issuance and sale of $750,000,000 aggregate principal amount of 5.125% Senior Notes due 2031. This transaction is conducted under an Underwriting Agreement dated December 9, 2024, and involves the registration of these securities with the Securities and Exchange Commission (SEC) .
- The Notes are to be issued pursuant to an indenture, which includes a Base Indenture and a Supplemental Indenture, with UMB Bank serving as the trustee .
- The proceeds from the sale of the Notes are intended to be used in a manner that does not violate any sanctions or anti-corruption laws, ensuring compliance with all relevant legal frameworks .
- The issuance of these Notes is part of VICI's strategy to manage its financial obligations and investments, potentially impacting its financial structure and operations .
- The transaction is structured to avoid any material adverse effects on the company's financial condition or operations, as indicated by the absence of any material adverse changes reported in the prospectus .
Legal Proceedings
Summary of the Legal Matter Involving VICI Properties Inc.
Key Parties Involved:
Nature of the Proceedings:
Potential Financial or Operational Consequences:
This summary provides an overview of the legal and financial implications of the current proceedings involving VICI Properties Inc. and its subsidiaries, focusing on the issuance of senior notes and the associated legal and financial frameworks.