American casino operator Penn Entertainment Incorporated has announced that it intends to spend approximately $850 million over the course of the next several years so as to bring its pair of its Illinois riverboat facilities onto dry land and add new hotel towers to its Hollywood Casino Columbus and M Resort Spa Casino Las Vegas venues.
The Wyomissing-headquartered firm used an official Monday press release to detail that this scheme is destined to see it build a new land-based home for its Hollywood Casino Aurora enterprise adjacent to the existing Chicago Premium Outlets shopping mall at an estimated cost of some $360 million. The company revealed that this project will eventually involve the property featuring a 200-room hotel, 10,000 sq ft of meeting and events space and a casino offering a Barstool Sports-branded sportsbook as well as a selection of 900 slots and 50 gaming tables.
Illinois intention:
Some 24 miles to the south and Penn Entertainment Incorporated explained that it wants to spend around $185 million in order to replace its ageing Hollywood Casino Joliet riverboat property with a new land-based venue housed within the nearby Rock Run Crossings mixed-use development. The Pennsylvania-based firm divulged that this project is to ultimately open featuring multiple bars and restaurants, 10,000 sq ft of meeting and events space and a casino hosting a Barstool Sports-branded sportsbook alongside 800 slots and 45 gaming tables.
In the state of Ohio and Penn Entertainment Incorporated disclosed that it is planning to part with something like $100 million so as to construct a 180-room hotel for its existing Hollywood Casino Columbus venue. The operator noted that this fresh extra will furthermore host new food and beverage outlets while creating full-time employment opportunities for as many as 100 people.
Enticing extension:
Finally, Penn Entertainment Incorporated stipulated that it intends to bring a second hotel tower to its M Resort Spa Casino Las Vegas facility so as to add 384 rooms and take the Nevada venue’s total accommodation complement up to 774. The firm stated that this $206 million endeavor will also involve the realization of ‘expanded meeting space, updated amenities and additional local partnerships’ for the Las Vegas Strip property that it intends to unveil ‘at a later date.’
Jay Snowden serves as the Chief Executive Officer and President for Penn Entertainment Incorporated and he used the press release to declare that construction on the Illinois, Ohio and Nevada projects is set to begin in 2023 as part of an effort to ‘generate strong free cash flow returns and create long-term value for our shareholders.’ The experienced figure moreover pronounced that casinos are to remain at the heart of his company’s ‘omni-channel approach to entertainment’ that already involves the merging of ‘a rapidly growing interactive and media footprint’ with extensive ‘best-in-class retail operations and a database of more than 26 million myChoice members.’
Favorable financing:
In connection with this development path and Penn Entertainment Incorporated detailed that it intends to ink a new master lease agreement with landlord Gaming and Leisure Properties Incorporated concerning the Hollywood Casino Aurora, Hollywood Casino Columbus, Hollywood Casino Joliet and M Resort Spa Casino Las Vegas facilities. The operator asserted that this revised relationship, which furthermore involves the Hollywood Casino Toledo, Hollywood Casino at The Meadows and Hollywood Casino Perryville venues, should allow it to benefit to the tune of $575 million in cash including as much as $225 million at a 7.75% cap rate for the project in Aurora.
“The overall estimated budget for these new growth projects is approximately $850 million. With the ability to access attractive financing from Gaming and Leisure Properties Incorporated covering up to $575 million of the anticipated costs along with up to $50 million from the city of Aurora subject to final approvals, we have the opportunity to pursue these high growth projects while preserving our cash position and leverage profile.”
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