Vici Properties, a real estate investment trust, has made a strategic move by diversifying its portfolio into the bowling entertainment sector.
In a recent sale-leaseback transaction, Vici acquired 38 bowling entertainment centres from Bowlero Corp. for an aggregate purchase price of $432.9m.
This acquisition aligns with Vici Properties' overarching investment strategy, where it seeks out assets that demonstrate ‘lower cyclicality, low secular threats, proven durability and favourable supply/demand dynamics’.
In this new partnership, Vici Properties entered into a triple-net master lease agreement with Bowlero as part of the sale-leaseback transaction. This lease agreement is structured with an initial total annual rent of $31.6m, reflecting an acquisition cap rate of 7.3%.
These acquisitions are part of Vici Properties' ongoing expansion strategy, which has recently included a foray into the Canadian market through partnerships with Century Casinos.
The acquisition included properties such as Century Casino & Hotel Edmonton, Century Casino St. Albert, Century Mile Racetrack and Casino in Edmonton, Alberta and Century Downs Racetrack and Casino in Calgary, Alberta.
The transaction's lease terms are set at a 15-year initial base term, with an option for four 5-year renewals, ensuring long-term potential and financial flexibility.
Furthermore, Vici Properties has shown financial gain and stability in recent years. In 2021, the company generated $1.5bn in total revenue, showcasing a 23.2% year-on-year growth.
