I'm one of the biggest critics of the Horseshoe here (heck, MTS and I sparred for days on the subject in the past) but I think its way too early to judge whether it has had much of an effect downtown.  The biggest gain has been in the hotel industry for obvious reasons. I think a couple of the restaurants did move in because of it but its hard to say it was the only reason. I'd bet Red, Tilted Kilt and Chipotle would've ended up there regardless. Several restaurants have folded since the casino opened including Prime Rib. We're not seeing a huge spin off yet and retail hasn't moved at all. TC hasn't added anything of value and Dredger's Union went under. There is one thing I'm angry about and that's the fact that the Horseshoe has added suburban restaurants to their comp program. Kind of defeats the purpose of promoting an "urban casino" and downtown restaurants but I always considered that nothing but marketing PR. In the end, its just another casino but in a very cool location.

 

Financially, I think the casino is doing ok but that's only on the strength of table games. Its slot performance is woeful (it brings in about the same as the Erie casino) and will only get worse once the racinos open up. Its obvious that slot players haven't warmed up to the Horseshoe. Many are staying away. Whether its because of tight slots, bad service or the location, I don't know. As long as tables keep going well, there's not too much reason to be worried. The struggles at the slots do make me wonder if a phase 2 will ever be built. At this time, I don't see the demand in it. The performance isn't there unless you believe adding more amenities, etc. will boost the slots. Maybe these new bus runs will help the numbers.

 

As far as Gilbert and his development in the city, since when are sports owners obligated to invest in the city? Few seemed to criticize the Gunds or the Lerners on that. The Dolans get a pass. All fans want is a winning team. Most could care less about the rest. Gilbert has gone beyond anything he has to do here. Detroit is his hometown and where his companies are based. He wants to rebuild his home city. Whats so bad about that? Sounds like nothing but jealousy.

Clevelanders should be focused on complaining about with Forest City, and other Cleveland locals are doing for Cleveland not an out of towner that has bought a business (the Cavs) and started another (the casino) in Cleveland.  If Gilbert did not invest in Higbee Building and the garage, no question both would be empty today.  Look at the remaining building across e 4th Street on prospect -no local developer has invested in them yet.  They are virtually all empty and no one care until someone knocks them down to build new.  I was recently in Cleveland and the city looks much more polished and vibrant since the casino has opened.  And don’t forget the impact of 1,600 employees that work and pay taxes, take public transportation and have lunch/dinner in downtown (even if it fast food) has on the city.  People that visit for conventions will have another place to go as part of your portfolio.     

^ oh you know clevelanders do complain about forest city, but they line the right pockets in city hall so holding them to the fire on downtown redevelopment or threats of eminent domain will never be invoked on them. to be fair there are others, such as some of the parking lot owners, with the same, unh, privileges of sitting on their arses.

 

that's all right, everyone else is working around those parcels. and that is pretty awesome.

 

Look at the remaining building across e 4th Street on prospect -no local developer has invested in them yet.  They are virtually all empty and no one care until someone knocks them down to build new. 

 

Fwiw, they are owned by a Los Angeles-based parking lot company that tried to demolish them a year or two ago for surface parking.  MRN has tried to buy at least one of the buildings, but the current owners wouldn't sell.

There's more. You have newby Chaim Schochet, the youthful Ari Maron and the suburban industrialist Fred Geis who is now a converted urbanist, each of whom are getting their financing pre-approved for major building acquisition or development projects while dusty old developers like Forest City and Jacobs Group whine that they can't make money in Cleveland. So while the old guard rusts, the new guard is getting things done. Gilbert is one of those newcomers who is relieving the old guard of their burdens and injecting new life into the city. But he is hardly the only one or even the boldest one. And that's cool with me.

There's more. You have newby Chaim Schochet, the youthful Ari Maron and the suburban industrialist Fred Geis who is now a converted urbanist, each of whom are getting their financing pre-approved for major building acquisition or development projects while dusty old developers like Forest City and Jacobs Group whine that they can't make money in Cleveland. So while the old guard rusts, the new guard is getting things done. Gilbert is one of those newcomers who is relieving the old guard of their burdens and injecting new life into the city. But he is hardly the only one or even the boldest one. And that's cool with me.

 

In defense of FCE, they did Tower City. Its been decades since they've done anything significant but that was their grand play in their hometown. And of course, being a publicly traded company makes a difference too. These other groups are private companies and don't have shareholders to answer to. They can think more outside of the box and take more risks. Gilbert and his partners are certainly doing that. I doubt buying up a bunch of buildings in Downtown Detroit would be cheered by any shareholders of a public company. You would probably be tarred and feathered for even considering it. Taubman and Ramco certainly aren't doing anything in the city. And while Geis is an urban convert, so is Gilbert. The old Quicken HQ was closer to Ann Arbor than it was Detroit! He built it way out on the edges off of I-275 in a sprawl filled corporate park. Clearly, he's had a change of heart and Detroit will be much better off because of it.

Forest City also just spent a lot of money renovating the top of the Terminal Tower basically rebuilding the while thing

In defense of FCE, they did Tower City. Its been decades since they've done anything significant but that was their grand play in their hometown. And of course, being a publicly traded company makes a difference too. These other groups are private companies and don't have shareholders to answer to. They can think more outside of the box and take more risks. Gilbert and his partners are certainly doing that. I doubt buying up a bunch of buildings in Downtown Detroit would be cheered by any shareholders of a public company. You would probably be tarred and feathered for even considering it. Taubman and Ramco certainly aren't doing anything in the city. And while Geis is an urban convert, so is Gilbert. The old Quicken HQ was closer to Ann Arbor than it was Detroit! He built it way out on the edges off of I-275 in a sprawl filled corporate park. Clearly, he's had a change of heart and Detroit will be much better off because of it.

 

Oh I agree about FCE. Which is why I don't like publicly held development companies. Developing is a risk, and cities can't grow without risk. Publicly held companies tend to minimize their risks more than privately held companies. So when development in Cleveland depends on publicly held developers like FCE, we're just not going to see much progress here. Publicly held companies tend to focus their development activities in growing cities. Those cities are growing because someone else has already taken the risk to cause momentum and make that growth happen. So let's leave the development in Cleveland now to the likes of Maron, Schochet, Geis, Gilbert and others who are willing to take the risks.

I wish we had 100 people like Dan Gilbert, from all over the country, "speculating" on Cleveland's future with an intent to improve it (and make a profit).  I would not agree with all of their plans, but it would be exciting to have multiple plans for our future and people from outside our region actively involved. 

Dan Gilbert's Bedrock Real Estate to announce national retailer for downtown Detroit 'Z' building Wednesday

By David Muller | [email protected] MLive.com

Follow on Twitter

on April 01, 2014 at 11:37 AM, updated April 01, 2014 at 12:42 PM

 

DETROIT, MI - Bedrock Real Estate Services plans to reveal an anchor retailer for the ground floor of its 535,000-square-foot "Z" parking garage in downtown Detroit on Wednesday.

 

The company, which is the real estate arm of Quicken Loans founder and Chairman Dan Gilbert, said Tuesday that the media will be given an overview of the “national retailer’s plans for Detroit,” but did not name the new tenant.

 

Rumors have swirled around Punch Bowl Social, a restaurant and bar that has ping-pong, bowling and vintage arcade games, as the incoming retailer. Crain's Detroit Business reported last week that the retailer was considering the site. A company spokeswoman for Bedrock would not provide further details Tuesday.

 

Punch Bowl Social has locations in Denver and Portland, and says on its website that Detroit and Austin locations are "coming soon." A phone message was left with the company seeking more details Tuesday morning.

 

http://www.mlive.com/business/detroit/index.ssf/2014/04/dan_gilberts_bedrock_real_esta.html#incart_river_default

I wish we had 100 people like Dan Gilbert, from all over the country, "speculating" on Cleveland's future with an intent to improve it (and make a profit).  I would not agree with all of their plans, but it would be exciting to have multiple plans for our future and people from outside our region actively involved.

 

Please stop with this.  Sometimes Clevelanders need to wake up.  Dan Gilbert does not care about Cleveland like you think he does.  Stop reading the PD articles on him, and get in touch with reality. Read his twitter and read about how he supports Detroit,  but you don't find anything about the great happenings in Cleveland.  It is already embarrassing enough that he puts Cleveland and Detroit in the same sentence a majority of the time.  I had some time off work last month so I went up to Cleveland to check on a lot of the projects taking place up there.  I started out with lunch on the west side, and worked my way downtown.  The Stanley Block looks like $hit.  Mounds of mud and trash.  The skywalk?!  Gilbert knows the importance of history and saves buildings left and right there in Detroit, but tears them down in Cleveland and defaces them with huge walkways.  I promise you Gilbert would bit** about that until something was done, but who cares about Cleveland, right?  More people like locals are making a bigger change in Cleveland than he is with a hell of a lot less money.  But the majority of Clevelanders fail to realize this because they don't own a sports team.  We won't go into Gilbert's complete failure of owning the Cavs.

 

He has done more harm to Cleveland's image than good.  Whoopty freakin doo he built a casino.  The letter, the Columbia,  and walking past that mess that was the Stanley only frustrated me more.  I know Clevelanders deserve better, but as long as they see a guy who they think cares about Cleveland on the outside but doesn't give a rat's @$$ in reality will continue to support him

until he sells the Cavs and realize he just talked a big game.  Don't put Cleveland and Detroit in the same sentence because Cleveland isn't Detroit.  Secondly,  if you're going to say you "love big Midwest cities like Detroit and Cleveland" maybe you can take care of your real estate in Cleveland a little better.

^Really?  Certainly Danny G isn't perfect, but to say he's done Cleveland's image more harm than good is beyond absurdity. Let's just play "It's a Wonderful Life" and like ol' George Bailey, and imagine Cleveland without Gilbert. 

 

HIGBEE BUILDING: would be sitting there largely empty, sealed/boarded up the way it was pre-Horseshoe and the areas around it would still be dead most nights, including weekends btw  -- we Rapid riders can remember a few years ago that uncomfortable feeling walking to trains past this empty shell and the desolate, poorly-lit TC/PS sidewalk.  With the casino, this area buzzes on some level every day and evening, 24/7.  We’ve never had a facility like it, esp in the center of town.  It’s now well-lit and there are usually cops all over the place, which is a great for the feeling of greater safety… The increased foot-traffic around Public Square, Ontario and Prospect in/around TC and the casino is obvious and nearby restaurants, like the Tilted Kilt, have experienced growth as a result.  As a Rapid rider and advocate, I love the increased ridership the Horseshoe has spawned.

 

The cabbies that line up in front of Terminal Tower weren’t there before the casino (yeah maybe 1 or 2 every now and again at the Renaissance, but not the lineup there is today).  As someone old enough to remember Higbee's Department Store in somewhat its heyday of the 70s and 80s (when The Christmas Story chose to film there), I can tell you that, with the exception mega shopping days, especially around the holidays, that store did not routinely attract the crowds the casino does.  (maybe this wasn't the case in the 30s-60s, but I'm not old enough to speak on that as an eyewitness).  I worked in the Terminal complex in the mid-late 80s and, despite the lunchtime boost of foot-traffic, most mornings and afternoons there was a trickle of Higbee’s/Dillards patrons – not unlike Tower City today – but Horseshoe has even made a noticeable impact on our oft struggling downtown mall… And Higbee's routinely closed by 6-7p most nights except, if I recall, Wednesdays (or Thursdays) when they were open til 8p. 

 

Btw casino wouldn't exist anywhere in Ohio had it not been for Gilbert and his hard-driving ballot initiative.  In addition to Cincy, Columbus and Toledo, we’re also talking about the Northfield Park/Hard Rockcino/racino as well as at legendary Thistledown which probably would be gone were it not for the slots.  Hey, I’m not the biggest advocate/fan of gambling because I realize it can, and has, destroyed a lot of lives.  …  But it’s where our cities are at in the 21st century – you either get on board or get left behind, and the conservative elements that too often grip this state were poised to keep Ohio in the Bible-thumping past while Ohioans would be busing to Detroit, Pittsburgh and WVa to get their gamble on. Gambling also does give our seniors something to do (out of the house) and the vast majority probably are not frittering away their lifesavings at the 1-arm/1-button bandits, they’re having fun and comradery with fellow seniors.  Most casino patrons I see as I pass through are smiling and having fun, not sad (and I can tell you that people-watching at the Horseshoe is like no other place in town).  And besides, the placing of the Horseshoe in HIgbee’s in the center of town gives it more impact to downtown than any of the other urban casinos I’ve seen, including Detroit’s Greektown, which was very nicely done.

 

SPORTS: The Cavs very well may have not had the great LeBron run because Gilbert's first act was to fire Paul Silas – you know, the coach who in 2 years, couldn’t even get LeBron James’s Cavs into the playoffs?  Gilbert also spent a ton renovating the Q and brought in the Laker Erie Monsters – I don’t care much for hockey, esp minor league hockey, but here again, the team constantly brings people – including a lot of families, into downtown including on off weekday nights.  Even though the Dolans finally did get lucky (that Terry Francona fell to them) and have, recently, invested some money on the Indians, Dan Gilbert is still far and away our best sports owner in terms of putting a ton of money behind his franchise, even though the results of late have not been good for the Cavs…

 

JOBS: Gilbert has brought in over 2,000 jobs, mostly with branches of his Quicken Loans operation.

 

COLUMBIA, STANLEY – I agree that I didn’t like the heavy-handed way these buildings were destroyed, esp the little Stanley where, really, there’s hardly any net-gain for Gilbert since it’s footprint was so small.  I nice classy restaurant or even a bar in the Stanley would have been awesome… The Columbia was a great architectural landmark…. But it was empty with no proposals to reuse it.  Maybe it would have attracted a developer to convert it into much needed apartments, which is obviously happening all over downtown, but nothing had materialized; also, it’s neighboring block of buildings, including the Goldfish and Record Rendezvous buildings are still vacant with no proposal yet to use them… I didn’t like destroying Columbia, but it was replaced by a reasonably attractive and useful building.  And even Horseshoe’s over-priced gift shop has put some ground-level retail there.

Sure, Dan’s letter to LeBron was stupid, I don't care for the skywalk, although I'm starting to get used to it (and you can't deny its utility after the hell-a-fied winter we've just experienced).  But this issue of Gilbert making these developments for his own financial interest... well duh, isn't this, like, America?  If it hadn't been for self-interested Horatio Alger-type moguls like John D. and his Standard Oil, do you think Cleveland would be any more than say Painesville (hey P'ville, I have nothing love for ya, I'm just using it as an example)?

 

This ongoing Gilbert hatred is baffling to me.  So what he's invested more in Detroit.  It's his hometown for God's sake and, in case you haven't noticed, is in far greater need of help than C-Town.  I guess it’s Cleveland’s inferiority complex showing that we constantly dislike “outsiders” no matter how much they actually help the town.  For my money, MissinOhio, Cleveland can’t have enough Dan Gilbert’s, I don’t care how much that thought gores your ox.

 

 

 

Don't put Cleveland and Detroit in the same sentence because Cleveland isn't Detroit.  Secondly,  if you're going to say you "love big Midwest cities like Detroit and Cleveland" maybe you can take care of your real estate in Cleveland a little better.

 

Not really my conversation or area of expertise, but I do not think Gilbert means any harm by comparing Detroit and Cleveland.

 

The cities are socioeconomically very similar. And both are making nice comeback efforts in recent years. Definitely a lot to be proud of with both locales.

Dan Gilbert and Detroit.....

 

Originally Published: October 19, 2014 8:00 AM  Modified: October 21, 2014 6:24 AM

Billion-dollar development philosophies: Gilbert quick to the punch; Ilitch opts for slow, hold

By Bill Shea and Dustin Walsh

 

Huge swaths of Detroit are getting an extreme makeover courtesy of Dan Gilbert and the Ilitch family. And as divided as their geographical areas are — Ilitch in an entertainment district centered near Woodward Avenue and I-75, Gilbert in downtown — so are their styles.

 

Gilbert has been fast and open with his wallet, often making media announcements about his purchases. Meanwhile, the Ilitches quietly and gradually acquired parcels, and then sat on them until the unveiling of the vision for the Ilitch-led arena district this summer.

 

The differences in style are due, at least in part, to the nature of the projects.

 

READ MORE AT:

http://www.crainsdetroit.com/article/20141019/NEWS/310199967/billion-dollar-development-philosophies-gilbert-quick-to-the-punch

What Kind of Track Records Do Dan Gilbert and Quicken Loans Really Have? And Does Anyone Really Care?

By Vince Grzegorek and Ryan Felton

 

As the economies of two great Midwestern cities cratered, Dan Gilbert emerged not just unscathed, but stronger, richer, more powerful. At the center of the billionaire's empire, of course, is Quicken Loans, the company he founded that has risen from the ashes of the 2007 housing market collapse.

 

The tentacles of Gilbert's riches reach out across the Rust Belt in veins that touch just about every sector of the economy, as you're well aware. In Cleveland, he has the Cavs, newly anointed the next champions of the NBA after Gilbert's wooing of LeBron back to the shores of Lake Erie. And the Horseshoe Casino, and Bizdom U, and a 300-person-plus downtown office of Quicken Loans, headquartered in Detroit.

 

...

 

http://www.clevescene.com/cleveland/what-kind-of-track-records-do-dan-gilbert-and-quicken-loans-really-have-and-does-anyone-really-care/Content?oid=4408612

Wonder what Danny will do with the money?

 

Equity firm flips digital advertising giant

BY: BUSINESS OBSERVER

October 17, 2016

 

A unit of global communications services conglomerate WPP, Xaxis, has acquired St. Petersburg-based digital ad firm Triad Retail Media, one of the largest privately held companies in the region.

 

Terms of the deal weren’t disclosed.

 

Xaxis bought Triad, with $502 million in sales in 2015, from Rockbridge Growth Equity, which acquired majority ownership of Triad in 2013. Rockbridge’s managing partner is Dan Gilbert, founder and chairman of Quicken Loans and owner of the NBA’s Cleveland Cavaliers.

 

MORE:

http://www.businessobserverfl.com/section/detail/equity-firm-flips-digital-advertising-giant/

Dan Gilbert predicts good things for his downtown: Detroit. What about Cleveland?

http://www.cleveland.com/metro/index.ssf/2017/01/dan_gilbert_predicts_good_thin.html

I think the writer's just a wee bit paranoid.  Detroit is Dan's hometown where his company was founded, nurtured and now thriving.  Of course that, and his alma maters, Michigan State U. and Wayne State, are going to be the major objects of his affection and $$$$... That said, it's obvious he's made a ton of positive development in Cleveland, a nearby city where he had no interest until he bought the Cavs 11 years ago.  For long suffering Cleveland fans, like me, if he'd merely bought the Cavs, turned them into a 1st class sports organization (rare at the time for Cleveland; Jacobs had sold the Indians and all we had/have were the, gulp, Browns), as he has (and turned them into champions, no less), that  would have been enough...

 

... but he developed the casino from a desolate, dingy abandoned Higbees' department store, put more Quicken Loan's office workers in Higbees, bought TC's Avenue to fix up and grow, fixed up the Q and bought at least a thousand -- probably a couple thousand jobs here (with more likely to come).  I'm not saying he's been perfect, but having Dan move into this market has made this region, especially downtown, a whole hell of a lot better than if he'd simply stayed in Detroit... So per the PD article, I don't think he has to walk around with a bullhorn, or a sandwich sign professing his love for our city... action speaks louder than words.

Sort of a waste of an article. All it is trying to do is get people to write lots of comments.

^ totally agree.

 

sports success aside, the thing about this guy is that he is downtown focused and he is active about it.

 

everybody needs more of that.

^I wish every city had a Dan Gilbert.  At least in Cincinnati, the corporate players have a big role in the redevelopment in downtown and OTR, but I don't know if they are matching what Gilbert is doing in Detroit.  Not certain what all is going on in Cleveland and Columbus

... but he developed the casino from a desolate, dingy abandoned Higbees' department store

 

This is an incorrect description of Higbee. Forest City had investment more than $40 million in the Higbee Building prior to the casino, including converting three of the upper floors for Key Bank offices and rehabbing the main floors for a number of civic organizations (Greater Cleveland Partnership, Council of Smaller Enterprises, Positively Cleveland, etc.). One might argue that the casino brings more life to the building, but it was far from "desolate, dingy, or abandoned."

^I wish every city had a Dan Gilbert.  At least in Cincinnati, the corporate players have a big role in the redevelopment in downtown and OTR, but I don't know if they are matching what Gilbert is doing in Detroit.  Not certain what all is going on in Cleveland and Columbus

I've always been jealous of Columbus with Nationwide. Always wished one of the big companies/power players did something similar.

Were entire floors unused? I recall seeing images of the interior but it was stripped down to the bare floors and walls with anything of significance placed in storage. ink[/member]

^Yes, about 1/3 of the floors were vacant, gutted to the structure.

... but he developed the casino from a desolate, dingy abandoned Higbees' department store

 

This is an incorrect description of Higbee. Forest City had investment more than $40 million in the Higbee Building prior to the casino, including converting three of the upper floors for Key Bank offices and rehabbing the main floors for a number of civic organizations (Greater Cleveland Partnership, Council of Smaller Enterprises, Positively Cleveland, etc.). One might argue that the casino brings more life to the building, but it was far from "desolate, dingy, or abandoned."

 

Yes, there's some truth to what you're saying, but the main entrances to Higbee's were sealed up and the main shopping floors were empty.  Positively Cleveland and the prior offices only used small portions of the space which, now, is entirely now -- 3 floors -- used by the casino.  And while casinos are not everybody's cup of tea, I'll opt for the vitality this 24/7 operation brings rather than a largely empty space.

Just be glad the second phase never happened. With the Racinos and other casinos coming in, receipts at Horseshoe/JACK have been dropping significantly.

bump

 

Who in Cleveland has recently invested in more development downtown that Gilbert?

Who in Cleveland has recently invested in more development downtown that Gilbert?

 

K&D.

 

I was critical of Gilbert in the past. But Bedrock's quick movement to start redevelopment on the May Company building has been fantastic. How nice would that stretch be if the Columbia building was still there.

I'm looking forward to seeing what Gilbert (hopefully) does with Tower City.  I'd love to see more "life" in there.  Hopefully the Terminal Tower apartment conversions will help Tower City by having a decent amount of people living right in that area.

Dan Gilbert hospitalized with stroke like symptoms on Detroit News, ESPN, SI.com but Cleveland.com has MGK releases new single.  Cleveland deserves better.

more about it:

 

https://finance.yahoo.com/news/billionaire-dan-gilbert-awake-responsive-022402063.html

I've heard "Rocket Mortgage Field House" for a while, but didn't know what it was.  Definitely something baseball-related with the word "field" in it, though it could have been soccer. Just learned that its the new name for the "Q".  What a crappy, long, and cumbersome name. Especially compared to "The Q" and especially as its the same company as Quicken.  And "Field" is a reference to baseball--that's why I always thought it was minor league stadium or something in the suburbs. There's no "field" in basketball--its a court. Not enough guts to call it "Court House" or something else more creative with "Court"?  What a really Sh*tty change for the city. 

 

 

5 minutes ago, Pugu said:

I've heard "Rocket Mortgage Field House" for a while, but didn't know what it was.  Definitely something baseball-related with the word "field" in it, though it could have been soccer. Just learned that its the new name for the "Q".  What a crappy, long, and cumbersome name. Especially compared to "The Q" and especially as its the same company as Quicken.  And "Field" is a reference to baseball--that's why I always thought it was minor league stadium or something in the suburbs. There's no "field" in basketball--its a court. Not enough guts to call it "Court House" or something else more creative with "Court"?  What a really Sh*tty change for the city. 

 

 

The Q? I thought it was called The Gund?

Mods--just saw the Q thread--didn't see it before. Feel free to move the above two posts to that thread!  Thanks.

It's good to see Dan Gilbert making progress in his recovery.  No matter your view, my take is that he has done a lot of good for both Cleveland and Detroit.  

 

https://www.crainsdetroit.com/health-care/gilbert-video-6-weeks-rehab-offers-first-look-his-recovery

 

Edited August 6, 20195 yr by newyorker

good to hear he is recovering.

 

carpetbaggers aggravate me, but i have slowly come around to him a bit  --- a championship helps lol.

 

he takes around $30M/yr out of town via the gambling money, but he has invested in cle to the tune of around a billion, plus there are local employee jobs/salaries and i assume some taxes paid -- so.

Witout Gilbert.

 

• May Company building is still empty
• Higbee building is still empty
• No investment of 600 Quicken Loans call center jobs downtown
• No invenstment in Public Square redevelopment (he redirected taxes from the Higbee Building to help)
• Those old run down bridal shop buildings on Onterio would still be standing 
• No Cavs championship
• No updating the The Q
• No hope for Tower City

 

 

Edited August 7, 20195 yr by newyorker

Well... the jury is still out on your last point.

 

The rest of which I agree.

Probably could also go in a Detroit transit thread....

 

 

A press release.....

 

VICI Properties Inc. to Acquire JACK Cleveland Casino and JACK Thistledown Racino in Sale Leaseback Transaction With JACK Entertainment

 

NEW YORK--(BUSINESS WIRE)--Oct 28, 2019-- VICI Properties Inc. (NYSE:VICI) (“VICI Properties” or the “Company”), an experiential real estate investment trust, today announced it has entered into a definitive agreement with an affiliate of JACK Entertainment LLC (“JACK Entertainment”) to acquire 100% of the membership interests of its affiliates that own casino-entitled land and real estate and related assets associated with JACK Cleveland Casino, located in downtown Cleveland, Ohio, and JACK Thistledown Racino, located approximately 10 miles southeast of downtown Cleveland in the city of North Randall, Ohio, for an aggregate purchase price of approximately $843.3 million in cash.

 

Simultaneous with the closing of the transaction, the Company will enter into a master triple-net lease agreement with JACK Entertainment related to the assets. The master lease will have an initial total annual rent of $65.9 million, for an implied capitalization rate of 7.8%, and an initial term of 15 years with four 5-year tenant renewal options. The rent coverage ratio at closing is expected to be approximately 1.72x and the tenant’s obligations under the lease will be guaranteed by Rock Ohio Ventures LLC. Additionally, the Company will provide a $50 million loan secured by certain non-gaming real estate assets of Rock Ohio Ventures LLC, which will bear interest at 9.0% for a period of five years with two 1-year extension options.

 

John Payne, President and Chief Operating Officer of VICI Properties said, “We are excited to partner with the team at JACK Entertainment as they focus on investing and operating in the Cleveland market. Ohio continues to be one of the healthiest and fastest growing regional gaming markets and we are thrilled to add high-quality, urban real estate to our portfolio at an attractive capitalization rate. This transaction represents another great example of VICI’s ability to creatively source and execute accretive deals that bring value to our shareholders, while furthering our strategic goal to diversify our roster of best-in-class gaming operators.”

 

“JACK Entertainment looks forward to continuing to operate JACK Cleveland Casino and JACK Thistledown Racino,” said Mark Dunkeson, Chief Executive Officer of JACK Entertainment. “The combined efforts of our gaming properties together with the other Cleveland assets operated by our sister companies including the Cleveland Cavaliers, Avenue Shops at Tower City and the May Company Building, have created a strong connection to the city and allows us to remain heavily committed to the Cleveland area. We have invested more than $700 million into JACK Cleveland Casino and JACK Thistledown Racino since the properties opened in 2012 and we will continue to invest significant capital into these properties which will have a lasting positive impact on the city and Cuyahoga County.”

 

David Kieske, EVP, Chief Financial Officer of VICI Properties, also commented, “The acquisition of JACK Cleveland Casino and JACK Thistledown Racino will add an additional $65.9 million of rent to our portfolio upon closing. Importantly, we will not issue additional equity to finance the transaction as we prudently secured our equity funding requirements through our successful June 2019 equity offering. Accordingly, we anticipate closing our remaining pending transactions, including our previously announced transactions with Century Casinos, Inc. and Eldorado Resorts, Inc., on a leverage-neutral basis.”

 

JACK Cleveland Casino opened in May 2012 in the historic Higbee Building in downtown Cleveland, Ohio. The property features approximately 96,000 square feet of gaming space, 1,300 gaming machines, over 120 table games and eight food and beverage outlets. The property is connected to the 205-key Ritz-Carlton and 440-key Renaissance hotels in downtown Cleveland. JACK Thistledown Racino opened in April 2013 in North Randall, Ohio and is the leading thoroughbred racino in the Cleveland MSA. The property is situated on 129 acres and features approximately 57,000 square feet of gaming space, 1,459 gaming machines and six food and beverage outlets.

 

The transaction is subject to regulatory approvals and customary closing conditions and is expected to close in early 2020. The acquisition is expected to be accretive immediately upon closing.

 

In addition to this release, the Company has furnished a Transaction Overview presentation, which is available on our website in the “Investors” section, under the menu heading “Events & Presentations.”

 

Goldman Sachs & Co. LLC is acting as financial advisor and Kramer Levin Naftalis & Frankel LLP is acting as legal advisor to VICI Properties for the transaction described herein.

 

About VICI Properties

 

VICI Properties is an experiential real estate investment trust that owns one of the largest portfolios of market-leading gaming, hospitality and entertainment destinations, including the world-renowned Caesars Palace. VICI Properties’ national, geographically diverse portfolio consists of 24 gaming facilities comprising over 40 million square feet and features approximately 15,200 hotel rooms and more than 150 restaurants, bars and nightclubs. Its properties are leased to industry leading gaming and hospitality operators, including Caesars Entertainment Corporation, Penn National Gaming and Hard Rock International. VICI Properties also owns four championship golf courses and 34 acres of undeveloped land adjacent to the Las Vegas Strip. VICI Properties’ strategy is to create the nation’s highest quality and most productive experiential real estate portfolio. For additional information, please visit www.viciproperties.com.

 

Forward-Looking Statements

 

This press release contains forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words “assumes,” “believes,” “estimates,” “expects,” “guidance,” “intends,” “plans,” “projects,” and similar expressions that do not relate to historical matters. All statements other than statements of historical fact are forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond the Company’s control and could materially affect actual results, performance, or achievements. Among those risks, uncertainties and other factors are risks that we may not achieve the benefits contemplated by the acquisition of the JACK Cleveland Casino and JACK Thistledown Racino casino-entitled land and real estate and related assets; that not all potential risks and liabilities have been identified us in our due diligence of the JACK Cleveland Casino and JACK Thistledown Racino real estate assets; that our pending transactions with Century Casinos, Inc. and Eldorado Resorts, Inc. (the “pending transactions”) may not be consummated on the terms or timeframes previously disclosed, or at all; the ability of the parties to satisfy the conditions set forth in the definitive transaction documents, including the ability to receive, or delays in obtaining, the governmental and regulatory approvals and consents required to consummate our pending transactions, or other delays or impediments to completing these transactions; our ability to obtain the financing necessary to complete our pending transactions on the terms we currently expect or at all; disruptions to the real property and operations of the subject properties during the pendency of the closing of the pending transactions; and risks that the Company may not achieve the benefits contemplated by the pending transactions (including any expected accretion or the amount of any future rent payments). Important factors that may affect the Company’s business, results of operations and financial position are detailed from time to time in the Company’s filings with the Securities and Exchange Commission. The Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required by applicable law.

 

View source version on https://www.businesswire.com/news/home/20191028005379/en/VICI-Properties-Acquire-JACK-Cleveland-Casino-JACK

 

When I first read this, the question that came to my mind is... what do they plan to do with all of this money now? That's alot of money, and Gilbert is sure someone who thinks big. Will it be going to an existing project (such as City Block) or does he have something new in the works?

Gilbert selling off his casinos to become eligible to buy the Detroit Tigers?  

Is this revenue for Gilbert or is this Rock Ohio Ventures? I assume the latter given the former's stroke. Although he seemed fine in his video tribute to Fred McCleod, a stroke can be a deceiving thing. A stroke patient can recover pretty well for a few months but then fade away after that. And there is always the risk of another stroke(s). I wonder if Gilbert is taking a reduced role in his companies and that this move is being undertaken by the management of Rock Ohio, not Gilbert?

 

EDIT: it's possible that this could be an effort to raise capital for Rock Ohio Ventures, for use in developing the later phases of CityBlock along the river.

Edited October 28, 20195 yr by KJP

1 hour ago, ML11 said:

Gilbert selling off his casinos to become eligible to buy the Detroit Tigers?  

But Gilbert will still operate the casino. All that’s changing is he now has a landlord. Leasing back casinos has become all the rage. Even the Bellagio was sold but MGM is still the operator. 

 

I do wonder about this over the long term. Hard Rock is leasing back Jack Cincinnati from VICI. It’s possible JACK continuing to operate in Cleveland is a short term play and they will look for new management down the road. 

can someone explain how it is he can own the cavs and casinos? that seems like a conflict of interest if there ever was one. especially with sports book gambling now allowed everywhere. gracias.

57 minutes ago, mrnyc said:

can someone explain how it is he can own the cavs and casinos? that seems like a conflict of interest if there ever was one. especially with sports book gambling now allowed everywhere. gracias.

The NBA has multiple marketing deals with gaming companies. They are no longer anti-gaming. MGM Resorts owns an entire WNBA team and Vegas hosts summer games.   Even before that though, they allowed casino operators to own teams. Most notably, the Maloofs owned the Kings and were allowed to offer sports betting just not on the Kings themselves. https://www.espn.com/nba/news/story?id=3661587

On 10/28/2019 at 12:26 PM, Mwd711 said:

But Gilbert will still operate the casino. All that’s changing is he now has a landlord. Leasing back casinos has become all the rage. Even the Bellagio was sold but MGM is still the operator. 

 

I do wonder about this over the long term. Hard Rock is leasing back Jack Cincinnati from VICI. It’s possible JACK continuing to operate in Cleveland is a short term play and they will look for new management down the road. 

I assume JACK will eventually be re-branded as something else, maybe Hard Rock.

 

4 hours ago, Boomerang_Brian said:

Former Cleveland Browns executive to head Dan Gilbert-affiliated real estate company

 

https://www.cleveland.com/realestate-news/2020/08/former-cleveland-browns-executive-to-head-dan-gilbert-affiliated-real-estate-company.html

 

The Michigan-based Bedrock announced this week that Kofi Bonner would start in his new job on Sept. 21. Bonner was, until February, the chief operating officer of the Irvine, California-based development firm Five Point Holdings. He also had his own consulting company that worked on real estate products in San Francisco and Ghana.

 

Before that, the Ghana-born Bonner was the COO and executive vice president for the Browns and the first Black person to hold such a title in the NFL, according to a news release. He was with the team from 1998 to 2004 and oversaw the development of FirstEnergy Stadium.

...

Bonner will replace Matt Cullen as Bedrock’s CEO. Company Vice Chairman Bill Emerson has served as acting CEO in the interim.

 

It will be interesting to see if this will result in more activity by Bedrock in Cleveland.