Wynn Resorts has just announced that they will be selling their land to Realty Income for $1.7 billion. The real estate company is buying the land and all the real estate assets in Encore Boston Harbor. The announcement comes just shortly after Wynn Resorts announced that it will sell all its online gambling units at a high discount.
The high-end resort selling their land has not come as shocking news to many. Most resorts and hotels related to casinos have been selling their properties at a high rate after the effects of the COVID-19 pandemic escalated.
The pandemic has led to the closure of several businesses, especially businesses that involve social gatherings and activities.
Details on the Lease
The first annual rent on the lease is $100 million with a 30-year contract and a renewal option. The rent will increase by 1.75 percent in the first ten years, and a Consumer Price Index (CPI) topped at 2.50 percent over the remaining years on the lease.
Realty Company will be paying an additional rent of $20 million for the land and assets related to Wynn Resorts in Encore Boston Harbor. The additional rent comes with a specified cap rate and will be paid for six years after the completion of the transaction.
The 13 acres of land on Broadway in Everett, MA, will remain the property of Wynn Resorts. The resort has plans to build an expansion unit with extra parking and other amenities that are not related to casinos or gaming.
Realty Income announced that Wynn Resorts might sell the expansion unit after construction is completed. The initial transaction is still waiting for approval from the gaming directives and the government. The transaction is expected to be closed by the last quarter of 2022.
On the selling price issue, the CEO of Wynn Resorts, Craig Billings, said that the Encore Boston Harbor is the best gaming resort on the East Coast. According to Craig, they did a price valuation according to the property’s value.
Craig noted that the transaction would give the resort the necessary liquidity for future development projects. The transaction will also help the report to settle some debts that have accumulated over time.
About Wynn Resorts
The Wynn Resorts casino was first opened in 2019. The initial cost of the casino was $2.6 billion. The resort was the first-ever resort-casino situated near Boston with a style out of the Las Vegas books.
The resort-casino trades under the name WYNN on the Nasdaq Global Select Market. Wynn Resorts is in charge of its four branches; Wynn Resorts Encore Boston Harbor, Wynn Resort Macau, and Wynn Resort Las Vegas. The four resorts have different features.
The resort in Las Vegas has 4,748 hotel rooms, villas, suites, bars, two spas, 33 eatery experiences, and three shopping esplanades. The one in Encore Boston Harbor has 671 guest rooms, a spa, 16 dining and lounge areas, specialty shopping, a harbor walk, and a huge public park.
The Wynn Resorts in Macau has 1,010 hotel rooms, a shopping esplanade, 12 dining and bar areas, two spas, a rotunda show, and a salon. Wynn Palace is ideally located in the Cotai Strip, Macau. The resort has 1,706 spacious hotel rooms, 14 dining areas, suites, villas, a shopping esplanade, a spa, SkyCabs, and a large area with an art collection.