Wynn Resorts to sell Encore Boston Harbor real estate in $1.7bn deal
Realty Income Corporation has signed a long-term net lease agreement with Wynn Resorts to acquire the Encore Boston Harbor Resort and Casino for $1.7bn.
The lease will initially have an annual rent of $100m and a 30-year term, with one 30-year tenant renewal option. Ownership of Encore’s land and real estate assets will transfer to Realty Income, though Wynn Resorts will continue to operate the property.
Wynn Resorts also said it will retain its 13-acre land assemblage on the east side of Broadway in Everett, Massachusetts. On part of this land, the company intends to construct an expansion that is expected to include additional covered parking as well as other non-gaming amenities.
“Encore Boston Harbor is the premier gaming resort on the East Coast and the valuation we achieved in this sale reflects the property’s quality,” said Craig Billings, Wynn Resorts CEO.
“Equally important, the bespoke structure and terms of the lease allow us to maintain a great deal of operating flexibility across economic cycles.
“The proceeds of the transaction also provide us with liquidity for several of our upcoming development projects and the potential to retire other debt.”
Headquartered in San Diego, Realty Income is a real estate investment trust, one of a few that pays dividends monthly, rather than quarterly.
As a result, the trust has a registered trademark for the phrase “The Monthly Dividend Company.”
What’s more, this transaction represents its first acquisition in the gaming industry, and it is expected to be completed during Q4 2022.
Realty Income’s President and CEO Sumit Roy remarked: “This transaction demonstrates our ability to utilise our platform and scale to acquire prime real estate assets across a variety of industries in alignment with our investment criteria.
“Our investment philosophy centres around generating favourable risk-adjusted returns by investing in strategically important properties with partners who are leaders in their respective industries.”
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