VICI Properties Inc (VICI) — Q1 2025 Earnings Call Transcript

Thank you, operator, and good morning. Everyone should have access to the company's first quarter 2025 earnings release and supplemental information. The release and supplemental information can be found in the investor section of the VICI Properties website. Some of our comments today will be forward-looking statements within the meaning of the federal securities laws. Forward-looking statements, which are usually identified by the use of words such as will, believe, expect, should, guidance, intends, outlook, and projects or other similar phrases are subject to numerous risks and uncertainties that could cause actual results to differ materially from what we expect. Therefore, you should exercise caution in interpreting and relying on them. I refer you to the company's SEC filings for a more detailed discussion of the risks that could impact future operating results and financial condition. During the call, we will discuss certain non-GAAP measures, which we believe can be useful in evaluating the company's operating performance. These measures should not be considered in isolation or as a substitute for our financial results prepared in accordance with GAAP. A reconciliation of these measures to the most directly comparable GAAP measure is available on our website in our first quarter 2025 earnings release, our supplemental information, and our other filings with the SEC. For additional information with respect to non-GAAP measures of certain tenants and/or counterparties discussed on this call, please refer to the respective company's public filings with the SEC. Hosting the call today, we have Ed Pitoniak, Chief Executive Officer; John Payne, President and Chief Operating Officer; David Kieske, Chief Financial Officer; Gabe Wasserman, Chief Accounting Officer; and Moira McCloskey, Senior Vice President of Capital Markets. Ed and team will provide some opening remarks, and then we will open the call to questions. With that, I will turn the call over to Ed.

Thank you, Samantha, and good morning everyone. Over the next few minutes, John will talk to you about our exciting new relationship with Red Rock Resorts and our other growth activities, and then David will discuss our recent refinancing, our results, and our increased guidance. To start, I'd like to share my thoughts on what we at VICI anchor to in all times, especially in periods of high volatility and low certainty, which is working to ensure that we maintain our ability to sustain and grow the current cash income we distribute to our stockholders in the form of our dividend for the REIT management team. That should, of course, be standard operating procedure. And because of that, one might think that the sustaining and growing of dividends would be top of mind for REIT investors as well. Again, one would think, and yet, when we meet with our investors, which we do frequently, many of them will end the meeting by asking, is there anything we didn't ask about that other investors are asking about? When we are asked this question, we often answer, well, you didn’t ask about our dividend. But don’t feel bad, because very few investors do call the old-fashioned. I believe strongly that dividends should always be a top of mind topic, especially for REITs, but frankly, for most equity investments, as I'm sure you all know. Over the long term, the last 100 years, dividends have contributed about one-third of the S&P 500 total return, despite the fact that the long-term dividend yields of the S&P 500 have averaged under 2% over the last 30 years. Given a greater dividend yield of REITs dividends, of course, matter even more to REIT total returns. As of yesterday's close, the trailing five-year total return of the RMZ REIT index was 54%, of which 27% was price return and 27% was dividend return. Over that same five-year period, which I should note started in the spring 2020 COVID drawdown for stocks, VICI has generated 138 percentage points of total return, of which 84 points come from price return and about 54 points come from dividend return. I will also note that during that same five-year period, the S&P 500 generated 106 percentage points of return, of which 91 points were price return and 15 points were dividend return. As you can see, over that five-year period, dividends were a major factor in VICI outperforming the S&P 500 by a margin of over 30 percentage points, or about 30% over the last year too. Especially given the dominance of investor mind and market share, dividends didn't get a lot of attention. But it's been interesting in recent weeks, amidst the volatility of both equity and credit markets, to see dividends being talked about again. One of my favorite readings each week is Michael Hartnett's weekly flow show bulletin, which tends to come out late Thursday evening or early Friday morning. In the April 11 bulletin, in this admittedly cryptic way, Michael made the following points: and I quote on portfolios, we say own credit, eg, long dated, high quality US corporate bonds, many yielding 5 to 6%. On equity income, 71 companies within the S&P 500 have a dividend yield greater than 4% and 41 have a dividend yield greater than 5%, buy stocks that can defend dividends unquote. Did you get that? Is you get Michael's point that as of his writing on April 11, only 71 companies in the S&P 500 had dividend yields above 4% and only 41 had dividends above 5%. What's notable about those dividend yields, especially the greater than 5% dividend yield, is that those yields are comfortably above the current rate of inflation, and thus generate a meaningful real return in a world where real return matters as much as ever. As a fellow VICI stockholder, it gladdens me to point out that as an S&P 500 stock, VICI currently offers a dividend yield greater than 5%, and we believe that that dividend yield is, to paraphrase Michael Hartnett, a defended dividend. In the coming weeks and months, equity market volatility may die down, or it may not. Who really knows? But whether market volatility dies down or not, a well defended dividend can, and I believe likely will be a significant contributor to total return for the market as a whole and for VICI and its stockholders. Everything we do at VICI is ultimately about total return in all its key components. And so now I'll turn the call over to John and David, who will talk further about what we're doing to drive total return over the near and long term through our growth activities and through balance sheet and cost of capital optimization.

Thanks, Ed. Good morning to everyone. VICI is very proud of our core ability to develop relationships and convert them into valuable long-term investment partnerships. Not only were we able to successfully do this with Kane and Eldridge teams in connection with One Beverly Hills earlier in the first quarter, but subsequently, we closed our first transaction in partnership with Red Rock Resorts, connected to the development of a casino on tribal land in central California, as announced in our earnings release last night. On April 4, we committed up to $510 million of a delayed draw term loan facility for the development of the North Fork Mono Casino and Resort, which will be developed and managed by Red Rock Resorts. Red Rock is a premier gaming development and management company that operates productive assets in attractive geographies, and they have developed over $9 billion of regional gaming and entertainment destinations. They are also an established leader in Native American gaming and have developed and managed tribal casinos for over 20 years. Red Rock broke ground on the North Fork project in September 2024 and expects it to be completed by September of 2026. Upon completion, the casino is expected to feature 2,400 slot machines, 40 table games, two restaurants, three bars, a food hall, and a small retail offering. The 305-acre site is located in Madera, California, directly adjacent to Highway 99 where 4.2 million people live within a two-hour drive of the North Fork site. This transaction established a formal relationship between VICI and Red Rock and represents Red Rock’s first partnership with a REIT for VICI. It also represents our first gaming investment on tribal land and our second investment on tribal land overall, with the first being our Great Wolf Northeast loan announced in February 2023. Lending on tribal land in partnership with a high-quality gaming operator like Red Rock demonstrates VICI's ability to drive high-quality opportunities for continued investment in the gaming sector. Another benefit of VICI’s relationship-based approach is that it fosters close communication with each of our tenants. Having just 13 tenants and eight financing partners on our roster allows us to maintain consistent and frequent dialogue with all of them, which is particularly advantageous during volatile times such as these. We believe this level of communication, coupled with the monthly financial reporting received from the majority of our tenants, provides VICI with strong oversight of our portfolio. Looking across our portfolio, we continue to be big believers in Las Vegas, as there are just so many unique demand drivers that continue to fuel the city's activity. For example, over the Easter weekend, Las Vegas hosted WWE WrestleMania at Allegiant Stadium, drawing nearly 125,000 fans and marking the largest gate for any event in WWE history. T-Mobile Arena has also recently hosted packed houses for Stanley Cup playoff games, and the musical talent at the Sphere remains a compelling draw for the city. Additionally, during the first quarter, tens of thousands of guests attending conferences hosted by companies like Home Depot and Adobe flooded the city with activity. While a potential international travel slowdown has come into question, we would note that only 12% of Las Vegas visitation in 2024 was from international travelers. It is also possible Las Vegas may benefit from a domestic trade-down effect if Americans forego international destinations for regional gaming. We continue to monitor the landscape, and based on prior periods of heightened market volatility, we expect performance to be relatively resilient. Property performance will vary based on geography and asset, and at VICI, we focus on working with our tenants so they feel positioned to continue to successfully operate the properties we own. Like I said, partnership is at the core of what we do. It is one of the key factors underlying our success in building this company, as it drives current and future opportunities and allows our team to consistently seek to create value for our shareholders. Now I will turn the call over to David, who will discuss our financial results and guidance.

Thanks, John. It's great to speak with everyone today, and we greatly appreciate your time. Starting with our Q1 capital markets activity and balance sheet. At the end of the quarter, we successfully addressed all of our 2025 maturities, and now we have no debt maturing until September of 2026. On March 26, we priced our bond offering, and at its peak, our order book was six times oversubscribed. We issued $400 million of three-year notes at a coupon of 4.75% and $900 million of 10-year notes at a coupon of 5.625%, for a blended coupon of 5.34%, including the impact of our hedging program. During the quarter, we also sold 7.8 million shares, raising $254 million in gross proceeds under our ATM via the forward. And as I mentioned on our last call in February, we recast our $2.5 billion unsecured multi-currency revolving credit facility and extended the maturity until 2029, providing us additional duration and an ample source of liquidity. We have approximately $3.2 billion in total liquidity, comprised of approximately $334 million in cash, $620 million under our standing forwards, and $2.3 billion of availability under our revolving credit facility. Our net debt to annualized first-quarter adjusted EBITDA, excluding the impact of unsettled forward equity, is approximately 5.3 times, within our target leverage range of five to five and a half. Taking into account our recent bond refinancing activity, we have a weighted average interest rate of 4.47% adjusted for our hedge activity, and a weighted average of 6.7 years to maturity. Our proactive risk management of our cost of capital, balance sheet, and liquidity profile through volatile markets allows our team to stay focused on building relationships and our investment pipeline. This allows VICI to continue pursuing our sustained and sustainable return goals for our shareholders without having to pause for any period of time. Just touching on the income statement, AFFO per share was $0.58 for the quarter, an increase of 4.3% compared to $0.56 in the quarter ended March 31, 2024. Our results once again highlight our highly efficient triple net model, given the increase in adjusted EBITDA as a proportion of the corresponding increase in revenue. Our margins continue to run strong in the high 90% range when eliminating non-cash items. Our G&A was $14.9 million for the quarter, and as a percentage of total revenues was only 1.5%, which continues to be one of the lowest ratios not only in the triple net sector but across all REITs. Turning to guidance, as we noted in our release last night, we are raising our AFFO guidance for 2025 in both absolute dollars as well as on a per-share basis. AFFO for the year ending December 31, 2025, is now expected to be between $2.47 billion and $2.5 billion, or between $2.33 and $2.36 per diluted common share, compared to our prior AFFO per share guidance of $2.32 to $2.35. The raise represents an increase of a penny at both ends of the range. Based on the midpoint of our increased 2025 guidance, VICI now expects to deliver year-over-year AFFO per share growth of 3.8%. Just as a reminder, our AFFO guidance, excuse me, does not include the impact on operating results from any transactions that have not closed, interest income for any loans that do not yet have final draw structures, potential future acquisitions or dispositions, capital markets activity, or other non-recurring transactions or items. With that, operator, please open the line for questions.

I guess I wanted to focus on the newest deal and maybe just get a little bit more color on the draw of the property given the location. It's reasonably far from, say, the Bay Area. I heard, I think, John's comments about the local population, but is it fair to assume that you're, you know, this resort is really being designed to tap the Central California market? Do you expect other draws into the area? Just trying to get a better feel for what’s going to attract people there? And then secondly, given that it's on Indian land, how does the collateral work to the extent something doesn't work out? I don't think you can own property on casino land. So just trying to understand sort of the protections VICI has in the lending structure.

Steve, John Payne here. Nice to talk to you this morning. We spent a lot of time over the years getting to know the operator of the business, Red Rock Resorts. This is our first opportunity to work with them, but we've known them for years. We've followed what they've done in Las Vegas. We've been incredibly impressed with the way they operate their businesses and how they run the facilities. Obviously, you could argue they are the best developers in the gaming space. They've been working on this facility with the tribe for over, I believe, 20 years, and have studied how successful this can be. The catchment area, as I mentioned in my opening remarks, is large, and I do think there is an opportunity for new business to attract new customers and potentially take customers from others, particularly with a great operator who understands customers like Red Rock does. So we were very excited to work on this opportunity and to announce this first deal with Red Rock.

Yeah, Steve, good to talk to you. In terms of location, the location is phenomenal, as John mentioned in his comments. It’s right off Highway 99, where four and a half million people go by the site. The competition in the area is far inferior to the quality of the build that Red Rock is developing here and the draw that this facility will have in the area. In terms of how we got comfortable with this, Red Rock went out to raise this capital, and we participated in the syndicate of large money center banks. The total loan is $725 million, and we are committing $510 million of that. Given Red Rock’s experience, as John alluded to, there is a guarantee from Red Rock to complete the project, and we felt really good about stepping in and developing a relationship with Red Rock, who is one of the best developers out there in gaming as well as travel gaming facilities.

I was just curious if your view on tribal sale-leasebacks has changed at all? Obviously, you've done a lot of work on it, and this deal brings you a little bit closer, not quite there yet. So thanks.

Yeah, I'll start, and John and David can add in. Tribal sale-leasebacks continue to be a complex subject for us that we haven't entirely figured out. You know, it's right to ask about the collateral on a lending package of a casino on tribal land. With the involvement of Red Rock, we have a high level of confidence that the asset can perform and that our collateral is good. It’s obviously in the interest of the tribe that Red Rock be able to operate the property successfully so that our loan can eventually be paid off. When it comes to sale-leaseback, I would say we still haven't exactly figured out if we can get comfortable with the nuances of owning property on tribal land, especially given the fact, as Steve alluded to, that in the event of any kind of default, we as the owner of the building would not have the right or the opportunity to operate the gaming, which is obviously the economic engine of the asset. So I would say at this point we are still very much in a learning phase, but very glad to be to be partnering with the tribe and with Red Rock on this opportunity. David or John, anything you want to add?

No, you covered it all.

Great. And then, just as a follow up, given the macro environment, I'm just curious if you're seeing tariffs impact any of your partners in terms of their construction budgets or timing. Any impact on maybe draw on top schedules or else future discussions for the pipeline? Thanks.

Yeah, that's a very good question, Barry. As a general principle, there are obviously general conditions across the construction landscape. When it comes to these conditions, you really want to be able to understand whether you’re partnering with a development company that is very experienced in development through thick and thin, or are you partnering with an operator with a deep and successful track record of development? Whether it's Kane at One Beverly Hills, which is a dedicated development company, or Red Rock, which is an operating company with a proven track record as a developer, as John pointed out, with a $9 billion development track record, we're very confident in their ability to manage the variability associated with tariffs. David has been very close to Kane as it's gone through the planning and costing of this project. They're resourceful and anticipatory when it comes to the whole tariff situation.

Yeah, they're obviously understanding the magnitude of what they're building and getting ahead of the tariffs as best as they can. They've developed hedging strategies around being a little proactive around hedging potential future purchases around raw materials, knowing that they have the right contingency and the right development experience in place to ultimately get this bill.

Great, thanks. Good morning. I was wondering if you could talk about what the pipeline has looked like lately in the face of just the macro volatility, and whether there have been any changes in the types of things that you're seeing, the types of deals that folks want to do or don't want to do, geography, and so forth.

Yeah, I'll turn it over to John in a moment here, Tony. I feel a little like we're living in Groundhog Day, because I think at VICI, we've been talking about volatility for a while now. You could say, are we ever going to stop talking about volatility? It's been a reality of our life now for at least a couple of years. I think we would be foolhardy to have a house view at VICI that it's going to die down anytime soon. It certainly affects, on a most fundamental level, Tony. It affects animal spirits around M&A and the growth ambitions that usually drive M&A. I would say, across the gaming spectrum, and narrowly and the experiential spectrum more broadly, these volatile conditions and the uncertainty around both economic conditions and capital financing conditions have somewhat diminished the animal spirits around growth and growth by operators, which we believe are the biggest drivers of demand for our kind of capital and the role our capital can play in operators, whether developing new assets or through M&A, growing their store count. Having summarized the general conditions, I'll turn it over to John for more specific color.

Well, Tony, Ed answered that very well. Really, quarter to quarter, things don't change that quickly in the spaces that we look at. My opening remarks talked a lot about our relationship-based approach. My colleagues are probably tired of me saying, you don’t do a deal at the first lunch. We continue to spend time with operators, not only in gaming but in other forms of experiential. We educate them on how our capital can work, and we continue to see if there are opportunities where we can be valuable during this time, ensuring that it's accretive for us and valuable to them.

Got it, thanks. And then just one follow up on the guidance: how much in committed capital for various projects and loans, etc. is not in the guide because there's not a draw schedule? Just wondering how much you kind of have but just didn't put in at this point.

In the guidance, Tony, it's about $130 million of committed capital. I'd have to get back to you outside of that, but just know what’s that, and that comprises finishing up Great Wolf, Northeast, Homefield, Kalahari, and also starting up, obviously, the North Fork investment that we just announced. I think, Tony, it would be fair to say a lot, but we will come back to you with a more precise answer than a lot is outside.

First, maybe a follow up on that last question, and congrats on the new relationship with Red Rock. Can you give any details on why you think they came to you for development funding? I think you mentioned that it is part of a larger syndicate. And then, do you have any insight on how the timing of the funding could play out, which, again, I feel like is what just was asked. And maybe the answer is no, but confirming.

Caitlin, it's John. I'll start and then turn it over to David. We have followed with great respect the work of Red Rock since we started the company, even before my time when I was a former casino operator for 23 years. I watched Red Rock and how well they operate. As I started the company back in 2017, I thought about the companies I had great respect for, and one of them was clearly Red Rock. We’ve built a relationship from that start, and there just hadn't been an opportunity for us to work together. So as they developed this opportunity, we were in the loop from the start, had good conversation, and are excited to be a part of it. In terms of the funding cadence, this is a construction draw schedule: we put an initial $75 million upon closing, but there will be a regular cadence between now and, as John said, September 2026, when it opens up. So we're excited about the ability to deploy capital on a consistent monthly basis.

I want to add that for those who don't follow gaming, to really understand Red Rock, you need to know the quality of what they build and the quality of their operation. I think it's fair to say it is strip-level quality, even when it is off strip, as most of their assets are. If you were in Las Vegas, I highly encourage you to visit their assets, like the Red Rock resort in Summerlin, or their new asset, Durango, which is, as John says, very comparable to what you can expect them to be building with their partners.

Got it, and I know that there's limited detail you guys can give us on future, but I know that when you establish these relationships, it's not with the intent of doing a single deal. So considering that and all the development Red Rocks has done in the past, I'm wondering how you think about that future opportunity with them. Are you thinking it would be more development? Are there still leaseback opportunities, or something else?

Right now, there's no other opportunities. It's a one transaction with them. I think the question you're asking is if Red Rock was growing their business, would we be interested in helping them grow in a variety of ways, whether it's selling the real estate, or another opportunity to develop? The answer is absolutely yes, for the right opportunity. Obviously, it has to be accretive for us and work for them. But I hope you hear from our remarks that we have tremendous respect for how they run their company, how they develop their projects, and how they build partnerships with tribal nations. However, to be clear, this is one opportunity, and only one opportunity today. But we would love the opportunity in the future; just no commitments right now.

Thanks for taking the question here. Just maybe a little more of the nuts and bolts on the tribal side and the deal with Red Rock. To be clear, Red Rock is the borrower. The collateral package that VICI would have an interest in, it sounds like has nothing to do with the land itself but really would be just the construction that sits on top of the land. Just help me understand kind of what that is, and you know a little more about the security if anything might go wrong. Obviously, it doesn’t sound like it would, but just help us understand that. And then, it does sound like tribal lending is a bigger opportunity than maybe any of us appreciated, sitting here 12 months ago. Help us understand how that landscape has evolved and changed, now that GLP and I have announced the deal you guys have announced.

Yeah, right. It's David. I'll start and then chime in. The borrower is actually the tribe. They are providing the construction guarantee or completion guarantee to get the project built. The oversight and expertise they bring to the table is crucial. So the collateral is essentially the building. But as we talked about in this call and other calls, taking that back is very difficult. Given the fact that the tribe is the only entity that has the right to operate gaming, we have full faith and conviction around Red Rock and their buildings. The fact that they're putting up their balance sheet to provide the initial funding means this loan will complete the funding. And as I mentioned, there are a number of large money center banks that have come into the syndicate to finance the development here.

Just one other thing to add. This is Samantha. Regarding the collateral package, we also have a first priority security interest in the future cash flows and revenues from the gaming activities, including anything associated with gaming. That's an important point. When we think about lending, tribal lending versus a sale-leaseback, it's also about considering the LTV or the LTC; that's different from your percentage interest when you’re looking at what your collateral is when you already own the building and can operate. We view them as different when you think about where we are on the risk spectrum. I think when you consolidate all of that, it's all dependent on ultimately operating successfully. Again, the involvement of a proven operating partner across the gaming landscape gives us a lot of comfort, and I really would not minimize the importance of that completion guarantee from Red Rock.

Okay. And then I guess the second part of the question is more broadly about the tribal lending landscape. Help us understand if there were other traditional lending sources for a lot of these projects historically, and what has caused the REITs to explore this more deeply over the last few quarters.

It’s something we continue to look at, Rich. I’m not here to say that there’s 20 opportunities out there, but it’s definitely a part of our business that we’re studying more and better understanding. Not all deals are the same; not all deals have an operator like Red Rock running it. This is something we’ve been studying for years, and it doesn’t mean that it shows up, and we looked at it for three months. There have been others that have been involved in this type of lending over the decades that tribal casinos have been developed all over the United States, but it’s something that this particular opportunity was one we were quite excited about, and we announced that investment here over the past coming days.

To reiterate what I said to Tony, Rich, growth creates a demand for capital. As you look across the US gaming landscape, California is still a relatively young gaming jurisdiction. I think gaming has been in California for about 28 years now, and it’s only tribal gaming. So there is still white space on the California gaming map. Tribes are gaining the opportunities to put new stores onto that map, creating a need for capital that they don’t necessarily see everywhere else in the country at this point.

Thanks. If you could touch on your expectations for the Century Casino lease. I know it’s a small part of rents overall, but do you feel comfortable that the recent CapEx investments in those properties will help improve coverage?

Very good question. I’m smiling here because part of our organization was actually on-site visiting the assets, talking to the teams, looking at the new construction, and looking at the great numbers coming out of there. One of the things that's great about VICI and the way we're structured is that we have constant communication with our operators. We also get monthly results from the majority of our operators, have conversations with them about how the business is working, and how they think about capital. Century is one of them, and you’d expect that we're having these conversations with our large operators like MGM, Hard Rock, or others we have assets with. It’s exciting to see the new development we helped finance really take off in Missouri, and we’ll continue to see if there are ways we can put money to work with Century, as well as with some of our other operators.

Thanks. And then I guess just one other partner you didn’t mention there was Caesars. We've received some questions about the regional casinos. I know there’s 10 years remaining on that lease, but how are those conversations going?

I wouldn't say there are any burning conversations of any kind between us and Caesars around regional property performance. We obviously continue to be pleased at the capital that Caesars has been and continues to invest in our assets, both on the Las Vegas Strip and in the regions. We’re seeing the benefits of the capital they put into New Orleans, and they’ve invested a couple of hundred million into Atlantic City, as well as a $160 million capital investment into Lake Tahoe. We think that’s strong evidence of Caesars’ willingness to continue investing in these properties and driving performance, which should ultimately lead to rent coverage we all can be satisfied with.

With respect to the Red Rock arrangement, I don't know if you're able to characterize what the capital structure of that property is, and/or any comments around pricing on the loan that may be helpful, and as part of that, how you look at opportunities and the risk profile of them relative to where you were two or three years ago.

Good to talk to you. Let’s start with the loan. As we discussed, the total facility is approximately $725 million, comprised of two term loans: Term Loan A and Term Loan B. Our blended all-in yield is around seven, which includes some incremental fees. The capital we committed of $510 million will be the development funding for the project. We’re comfortable with the capitalization and the support coming from Red Rock and their expertise around getting this open and really the location. The competing product in the area is far inferior to what the Durango-style facility will be built here in central California. Regarding our risk appetite, as we talk about at VICI, we continue to learn and study different opportunities. As we've noted, we’ve looked at tribal setups for years and partnering with the right operator in the right location, while structured with the correct guarantees, puts us in a comfortable position.

I’ll just add that investing in any category, particularly in our investment category, general principles only take you so far. Any kind of general principles we might hold about tribal gaming wouldn't be that useful in making investment decisions. The specifics of this investment opportunity were compelling: the involvement of a highly proven, successful developer who is also a highly established operator. Those specifics were incredibly important in making this decision, and any future decisions we might make regarding tribal or commercial investments will always be based on the specifics.

Hey guys, good morning. I guess I'm curious if we should also be reading into the Red Rock construction loan that perhaps you'd be more comfortable being a construction lender more broadly under the right circumstances and with the right partners. Can you talk about your appetite for more of that type of loan activity going forward, and also some thoughts on the underwriting of the loan and the required return that you expect?

I would reiterate again that it will always be highly specific. We do not have a general strategy around construction funding. Our general strategy revolves around relationship development and identifying experiential partners we want to have a relationship with and grow over time. If helping them finance development opportunities starts the relationship, we’ll look at that energetically and rigorously.

Appreciate that. Maybe a follow up here: just speaking of relationships, is there any room for opportunities with any of your other partnerships that could be attractive to you here?

I didn't hear exactly the question, but I think it was, are there opportunities to grow with our current set of 13 tenants and eight financing partners? The answer I'll give you is, I hope so. I think that's always been the way we've talked about this, and why we don't have 100 tenants right now. We have 13, and I’m sure over time, we’ll grow to 14, 15, 16. But part of our strategy that we've discussed since we started the company was to find the best in the business and help them grow while also adding new tenants and new financing partners to grow accretively.

Thank you for taking my questions. The March and April trend commentary for your big public partners in Las Vegas has been very positive this earnings. Can you give us a sense if you're hearing the same things from the non-public partners on the Strip, like the Venetian Complex?

We're very excited. Nice to talk to you, Daniel. We were very excited. We see some numbers before they become public at times, and it’s encouraging to see Las Vegas continue to be quite successful and growing. As you heard in my comments, we like Vegas because there are so many different cash registers for reasons for consumers to come to the city. MGM and Caesars speak highly of their business. The Venetian has a robust performance. I was just out there myself, and I know Ed was as well, enjoying our time at the Sphere and seeing how that brings in a whole bunch of new consumers to not only the Venetian but also to Las Vegas as a whole, which is great to see. Vegas seems to be continuing to have a good run. Much of the credit goes to the operators, as they continue to find creative ways to attract both existing and new customers. We’re excited that we own those assets because those who do will continue to find ways, regardless of economic conditions, to grow their business.

Great. Thank you. That’s really helpful. And I did like your point on the potential trade down with more people going to Las Vegas. On the second part, you all have a wide range of partners, both big and small, with very different risk characteristics. Given the confusing macro, can you talk about the team’s approach to risk, and if there's a formal risk process in place to flag and work through any issues that you see developing over the next few years?

Yeah, hey, Dan, it’s Gabe Wasserman here. I can take the first part of that question, and others can weigh in as well. Since we founded the company in 2017, we've had a rigorous risk management process. We meet as a management team every quarter. There are two separate meetings: one to go over the performance of our tenants and our lease investment programs, and a separate meeting to go over our borrowers and the performance of our loan investments. So as a management team, we have a lot of visibility into the performance of our investments and a lot of rigorous discussions and underwriting.

Hey, good morning. This is Jenny in for Ron. Thanks for taking my question. I think my first is regarding the Caesars Forum Convention Center call options you have later this year. What are your latest thoughts on that deal, and if you would like to exercise on that?

Very good question. That call becomes live later in the fall. I don’t have the exact date, but I believe it’s late September of this year. I think your question is, do we like the asset? It’s a beautiful asset. How is it performing? It is something that we'll continue to evaluate as that time comes. Caesars built a beautiful space and is using it effectively to drive new business and new meeting business there. We are aware of that opportunity, and we’ve got a window that’s quite wide, and we'll study that opportunity closely when it comes.

I just want to say before you ask your second question that our decision-making is guided by solving for total return. As I mentioned in my opening remarks, when we look at the building blocks of our total return, those building blocks are dividend yield, same-store NOI, levered into AFFO per share, and external growth. We try to optimize our timing around opportunities like that, such that we are fundamentally solving for sustained and sustainable, superior total return. So that really is the calculus that guides our decision-making around not only what we invest in but when we invest in it.

Makes sense. I think the second one is regarding the strategic relationship with K International. I'm just curious if there are any incremental conversations this quarter about what other experiential investment opportunities you are looking to pursue together beyond the Beverly Hills project?

There are a lot of experiential categories we are fundamentally interested in. One example is their investment in a facility called the St. James, which is just outside of Washington, DC, and is very much like Chelsea Piers. They have been very open and energetic about their growth ambitions for the St. James as ultimately a network of facilities across the country, and we’ve enjoyed the conversations we've had on a preliminary basis about how we might be of service to them in growing that network.

Good morning. Thank you for taking my question. I noticed there was a deal with Star in Australia. Are you interested in getting involved in that or perhaps in Australia in general?

If you've been following us for a while, David and I spent some time down under about two years ago, visiting Australia and New Zealand to understand the landscape. The market in Australia, particularly where the assets are for the Star, has gone through radical change—not only structural balance sheet issues but also regulatory changes that have placed a significant burden on the business right now. I think your question was if we would be involved in an opportunity with the Star in Australia? The answer is no.

Sorry, Max, I just want to add that one key predicate for any investment we ever make is having a high degree of visibility and confidence around what the future earnings profile of a given asset will be. Right now, given the turmoil in the regulatory landscape and its impact on the economic performance of gaming assets in Australia, it is very difficult to have that visibility or confidence regarding what kind of returns these assets are going to yield over the longer term.

Understood, thank you for that. Maybe zoom out and take it to a higher level. Other than economics and accretion, could you talk about some of your top strategic priorities in your current opportunity set, whether that might be tenant diversification, geographic diversification, or something else?

I would say there are a couple of key result areas we focus on. I've already talked about our dedication to building total return on a sustained and sustainable basis. But it’s also about doing everything we can to weatherproof the business as best we can. No business is ever absolutely weatherproof. I’m proud of the work David and the team did, for example, in getting the refinancing done when we got it done, and against the backdrop of volatility and low visibility. A paramount focus of management will continue to be being highly anticipatory of what is potentially coming, and being as ready for it as we can, protecting our capital and the cost of our capital.

Thanks for taking my question. Just one quick one for me. There was some news regarding New York gaming. I'm curious about your latest thoughts on the New York gaming license process and what VICI will be doing from now till decisions are ultimately made.

Exciting times with some of the news that's out there. I will not predict when a license will be granted or the three licenses will be granted, but there does seem to be momentum moving for the RFPs to be submitted by the end of June or early July. One of the bidders is going to be MGM at the site that we own, the real estate and buildings. There are other very exciting opportunities in the news that could win one of the licenses. We are standing by and better understanding the circumstances. Obviously, we’re big fans of the MGM bid since that’s an asset we own. We would hope that we would help our current tenant, MGM, grow should they win one of the three licenses. We will continue to watch closely and keep reading the paper to better understand as we get closer.

We know that all of you, whether analysts or investors, are incredibly stretched right now given the volume of companies reporting. So we cannot express deeply enough our thanks for your time and attention this morning and your continued support. Goodbye for now.