The Oakland A’s have “a very, very strong interest” in the Tropicana as a possible stadium site should the team decide to move to Las Vegas, the top official with Gaming & Leisure Properties Inc. said Friday.
The Strip hotel-casino site is believed to be one of two properties under consideration for a Major League Baseball stadium for the A’s if the team determines it will relocate to Las Vegas.
Peter Carlino, chairman, president and CEO of Gaming & Leisure Properties Inc., a real estate investment trust affiliated with Tropicana operator Penn National Gaming, said his company and officials with Bally’s Corp. and the A’s met recently in Las Vegas to discuss the possibility of redeveloping the property.
Gaming & Leisure Properties owns the real estate under the Tropicana, which is operated by Penn National Gaming. A year ago, Rhode Island-based Bally’s announced plans to buy the Tropicana from Penn National for $150 million. Bally’s said the Tropicana’s “non-land assets” were selling for $150 million and that it had agreed to lease the land underneath the hotel-casino from Gaming & Leisure Properties for an initial term of 50 years at $10.5 million in annual rent. That deal was expected to close in the second half of this year.
But in January, Soohyung Kim, managing partner of Standard General L.P., a New York-based investment firm that has a 30 percent stake in Bally’s, offered to buy out the company in a deal valued at around $2 billion.
Carlino’s comment about the A’s interest came in response to a question from an investor during Gaming & Leisure Properties earnings conference call Friday.
“Obviously, anything we do is tied to our conversations with Bally’s,” Carlino said during the call. “It’s been widely publicized that the A’s are looking at this site. They’ve looked at others. I think it’s safe for me to say that they have a very, very strong interest in our site if the transaction can work to their advantage.”
But Carlino said any deal would have to benefit his company and its shareholders as well. Carlino said he and Gaming & Leisure Senior Vice President and Chief Investment Officer Matthew Demchyk and Senior Vice President and Chief Development Officer Steven Ladany met with the A’s and Bally’s earlier this month. Another source with knowledge of the dealings confirmed the A’s and Bally’s met regarding the Tropicana site.
Carlino said he’d be happy to complete its existing transaction with Bally’s but that if something bigger were to unfold, he’d be interested.
“There are a lot of hurdles that have to be covered,” Carlino said. “There’s absolutely no certainty about where that may go. If we can facilitate something exciting, you bet we will. There, I must say, stay tuned. We’ll let you know.”
Carlino offered no other details about what plans may be in place.
The Tropicana, with 1,470 hotel rooms and 50,000 square feet of casino space on 35 acres, has been rumored as a frontrunner for several months now as a potential site for an A’s ballpark. In December, reports surfaced that the A’s put a bid on the site the Tropicana sits on, located on the southeast corner of the intersection of Las Vegas Boulevard and Tropicana Avenue. Last week Athletics President Dave Kaval told the Review-Journal their ballpark list still featured five potential sites, with two emerging as favorites.
One he noted would feature the team partnering with an existing gaming group to enter into a joint-venture with. The other would be a site the A’s would purchase outright, with the thought of constructing a mixed-use development on, built around a $1 billion ballpark.
Five sites in running
All five sites still in the running in Las Vegas are in or around the resort corridor.
The Tropicana checks off both being in the vicinity of the Strip and being a potential joint venture, in this case with Bally’s or Gaming & Leisure.
The Athletics have been exploring the Las Vegas market since last May, with the year-long process potentially culminating next month.
That’s when Kaval noted the final Las Vegas site could be announced, with renderings of what the ballpark would look like included.
Gaming & Leisure, a rapidly growing REIT that in March completed the acquisition of land and real estate assets of the Live! Pittsburgh and Live! Philadelphia casinos from The Cordish Companies, Baltimore, Maryland, for $689 million by assuming debt and issuing partnership units.
Earlier this month, Gaming & Leisure completed its acquisition of the real estate associated with Bally’s three Black Hawk, Colorado, casino properties and the company’s Quad Cities Casino in Rock Island, Illinois. All of the properties were placed within a Bally’s master-lease agreement.
Carlino said the Wyomissing, Pennsylvania, company that started with 24 properties when it was founded in 2013 now has 55.
The company also reported in February that it was to issue a first-quarter dividend of 69 cents per common share to shareholders of record on March 11. Carlino told investors he plans to approach his board of directors about increasing dividends in the future.
Gaming & Leisure shares, traded on the Nasdaq exchange, were down 88 cents, 1.9 percent, to $45.33 a share on average volume in midday trading.
This is a developing story. Check back for updates.