Gaming and Leisure Properties Inc. (GLPI), a well-known gaming-focused real estate investment group, has completed a substantial deal by acquiring the site for the much-anticipated Hard Rock Casino construction project in Rockford, Illinois. The $100 million site acquisition reinforces GLPI’s strategic development aspirations in the gaming and entertainment sector.
GLPI has bought the site associated with the Hard Rock Casino development plan in Rockford, Illinois, in a strategic move. The purchase was made from 815 Entertainment, an entity controlled by Dan Fischer, the principle, as well as a collection of local investors and Hard Rock International, who is also the property manager. This attempt is consistent with GLPI’s goal to strengthening its position in the ever-changing gaming industry.
Simultaneous with the land acquisition, GLPI entered into a long-term ground lease agreement with 815 Entertainment, spanning an extensive 99-year term. The ground lease entails an initial annual rent of $8 million, with a fixed 2% annual escalation from the lease’s first anniversary throughout its duration. Additionally, GLPI has committed to providing up to $150 million of development funding via a senior secured delayed draw term loan at an interest rate of 10%, subject to regulatory review.
The term loan, featuring a draw period of up to one year and a maximum outstanding period of up to six years, including a one-year extension, enhances GLPI’s support for the Hard Rock Casino project. The term loan’s prepayment without penalty following the casino’s anticipated opening in September 2024 underscores GLPI’s dedication to the project’s success.
Located conveniently near Interstate 90 in Rockford, the Hard Rock Casino is poised to encompass approximately 177,000 square feet, highlighted by a substantial 60,000 square feet gaming floor. The gaming offerings at launch will encompass 1,250 slot machines, 50 table games, and both in-person and online sportsbooks. The ongoing construction, currently underway, is part of a comprehensive project budget totaling around $358 million, which includes the temporary facility’s costs.
Peter Carlino, Chairman and CEO of GLPI, expressed enthusiasm about the agreement, stating, “Our agreements with 815 Entertainment will allow GLPI to expand its footprint with the addition of a new ground lease, a new tenant, and a commitment to provide potential funding. We believe this is an attractive ground lease transaction for our shareholders as the strong initial results at 815 Entertainment’s temporary facility demonstrate the strength of the location and the depth of the market.”
With a robust portfolio comprising property assets from 59 gaming venues across 18 states, GLPI’s latest acquisition demonstrates its dedication to the industry’s growth. The inclusion of Hard Rock Casino Rockford marks GLPI’s sixth gaming venue in Illinois, reinforcing the company’s strong foothold. As a forward-looking player in the real estate investment sphere, GLPI’s collaboration with Hard Rock International underscores its commitment to fostering exceptional entertainment experiences.
Jon Lucas, Chief Operating Officer for Hard Rock International, voiced excitement about the upcoming venture, saying, “Hard Rock’s incredible financial strength and development trajectory is only made stronger with great partners like GLPI and 815 Entertainment. We are really looking forward to opening another world-class entertainment property with Hard Rock Casino Rockford.” As the project progresses, the collaboration is poised to redefine the entertainment landscape in Rockford, Illinois, and beyond.
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