Posted on: February 24, 2023, 03:46h.
Final up to date on: February 24, 2023, 03:46h.
Coming off a collection of cash-generating actual property gross sales in 2022, Bally’s (NYSE: BALY) might discover associated transactions sooner or later as avenues for funding mergers and acquisitions and new tasks.
Incoming CEO Robeson Reeves made feedback to that impact on the on line casino operator’s fourth-quarter earnings convention name on Thursday.
I imply, we’ll at all times view our land financial institution as a device to proceed to develop earnings earlier than curiosity, taxes, depreciation and amortization (EBITDA) for the enterprise. It simply needs to be the correct deal,” mentioned Reeves in response to an analyst query. “We’re snug with Chicago funding at this level. So we wouldn’t go and faucet a approach and make until it’s for an additional undertaking or M&A chance.”
Final 12 months, Bally’s engaged in sale-leaseback transactions with Gaming and Leisure Properties (NASDAQ:GLPI) on one in all its Rhode Island casinos and the Onerous Rock Biloxi in Mississippi. The owner additionally has an choice to amass the true property belongings of Bally’s Twin River Lincoln On line casino Resort in Lincoln, RI earlier than the tip of 2024 for $771 million and extra lease of $58.8 million.
Bally’s Has Actual Property Versatility
Even with the aforementioned transactions and others, Bally’s sits on a treasure trove of on line casino actual property throughout the US, giving it flexibility to lift capital with out issuing shares or heading to debt markets.
Whereas some regional on line casino operators choose to carry onto property, Bally’s might monetize a few of its current portfolio of on line casino actual property to fund additional growth in its land-based gaming enterprise or cut back debt.
“BALY retail casinos are set to develop +15% given M&A and natural builds. Past ’23, development ought to proceed and considerably step up when it opens the ~$1.7 billion CBD Chicago property in June 2026, which we presently assign as $2 of valuation, however may very well be as excessive as $7 of worth if profitable,” wrote Macquarie analyst Chad Beynon in a observe to shoppers.
A very worthwhile piece of actual property owned by Bally’s is the Tropicana on the Las Vegas Strip. Whereas that’s the operator’s solely venue within the US gaming hub, it is also the positioning of a brand new stadium for the Oakland Athletics. Ought to that occur, Bally’s would seemingly command a powerful worth for that actual property.
New York Plans
It’s additionally attainable that Bally’s might have interaction in future sale-leaseback offers to fund a New York Metropolis on line casino undertaking whether it is awarded one in all three downstate gaming permits.
The operator just lately threw its hat into that ring, pitching a gaming venue on the Trump Golf Hyperlinks at Ferry Level within the Bronx. Bally’s has an settlement in place to sub-lease 17 acres there from the Trump Group.
There’s chatter that Bally’s wish to ultimately purchase the whole 192-acre web site and use a few of the land not occupied by the on line casino for parks and inexperienced house for public consumption.