Gaming and Leisure Properties, Inc. announced that it acquired the real estate assets of Tioga Downs Casino Resort in Nichols, NY from American Racing & Entertainment, LLC for $175.0 million. Simultaneous with the acquisition, GLPI and American Racing entered into a triple-net master lease agreement for an initial 30-year term. The initial annual rent for the new master lease is $14.5 million and represents an 8.3% capitalization rate.

The initial annualized rent coverage ratio for the lease is expected to be over 2.3x. Rent associated with the lease is subject to a fixed 1.75% annual escalation beginning with the first anniversary and a fixed annual escalation of 2.0% beginning in year fifteen of the lease and carrying forward through the balance of its term. American Racing has 20 years of gaming, horse racing, and hotel experience, marking another addition to portfolio of leading gaming operator tenants.

Tioga Downs is a high-quality, recently expanded asset with significant geographic protection from competition. The company look forward to the start of a fruitful partnership with American Racing. The initiatives to further expand portfolio remain active in the current environment as company reputation as the gaming landlord of choice is strengthened.

The transaction was funded with cash on hand and the issuance of $20.0 million in OP units.