Gaming and Leisure Properties, Inc. (GLPI) said Tuesday (September 2) it will put up $225 million to help finance a new tribal casino and resort being developed by Caesars Entertainment and the Dry Creek Rancheria Band of Pomo Indians.
The project, called Caesars Republic Sonoma County, will be built on the site of the current River Rock Casino near Healdsburg, California. Construction kicked off in August and is expected to wrap up in the summer of 2027.
As part of the deal, GLPI will provide a $180 million loan at a fixed interest rate of 12.5% and a $45 million loan with a yield of nearly 14%, for a blended rate of about 12.8%. When the six-year loans mature, Dry Creek will lease the property to a GLPI affiliate for 45 years, paying at least $112.5 million. GLPI will then sublease the property back to a Dry Creek affiliate, with annual rent set at a 9.75% cap rate.
Once complete, Caesars Republic Sonoma County is expected to include a 100-room hotel, four restaurants, three bars, a luxury spa, pool, and fitness center. The casino will feature 1,000 slot machines and 28 table games. River Rock Casino will stay open while construction is underway.
GLPI partnership with Caesars part of ‘long-term tribal casino’ financing
Peter Carlino, chairman and CEO of GLPI, said the agreement broadens the company’s relationships in the gaming industry. “We are proud to be supporting Dry Creek Rancheria and initiating a relationship with the tribe in our role as the lead real estate financing partner for Caesars Republic Sonoma County,” Carlino said. He added that the agreement “reflects our corporate focus on working collaboratively with the industry’s best gaming operators, to enable them to achieve their growth and development goals.”
Carlino also called the deal a reflection of the company’s wider growth strategy. “This valuable partnership also validates other aspects of our growth strategy, importantly, our belief and commitment to pursuing long-term tribal casino financing and new market opportunities,” he said.
GLPI partnered with Citizens Bank, N.A. to put the financing package together, with TFA Capital Partners acting as financial advisor.
The Dry Creek Rancheria Band of Pomo Indians, which has run River Rock Casino since 2002, represents around 1,300 members, most of whom live in Sonoma County.
Featured image: Canva / Caesars Entertainment
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