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Real Estate Portfolio | 9 Months Ended
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Sep. 30, 2025
Real Estate [Abstract] |
Real Estate Portfolio | Real Estate Portfolio As of September 30, 2025, our real estate portfolio consisted of the following: •Investments in leases – sales-type, representing our investment in 26 casino assets leased on a triple-net basis to our tenants under ten separate lease agreements; •Investments in leases – financing receivables, representing our investment in 28 casino assets and 39 other experiential properties leased on a triple-net basis to our tenants under ten separate lease agreements; •Investments in loans and securities, representing our 18 debt investments in senior secured and mezzanine loans, preferred equity and the senior secured notes; and •Land, representing our investment in certain underdeveloped or undeveloped land adjacent to the Las Vegas strip and non-operating, vacant land parcels. The following is a summary of the balances of our real estate portfolio as of September 30, 2025 and December 31, 2024:
(In thousands) | September 30, 2025 |  | December 31, 2024
Investments in leases – sales-type, net (1) | $ | 23,763,616 |  |  | $ | 23,581,101 |
Investments in leases – financing receivables, net (1) | 18,640,073 |  |  | 18,430,320 |
Total investments in leases, net | 42,403,689 |  |  | 42,011,421 |
Investments in loans and securities, net | 2,432,999 |  |  | 1,651,533 |
Land | 149,717 |  |  | 150,727 |
Total real estate portfolio | $ | 44,986,405 |  |  | $ | 43,813,681 |
____________________ (1) At lease inception (or upon modification), we determine the estimated residual values of the leased property (not guaranteed) under the respective lease agreements, which has a material impact on the determination of the rate implicit in the lease and the lease classification. As of September 30, 2025 and December 31, 2024, the estimated residual value of the leased properties under our lease agreements was $16.5 billion and $16.4 billion, respectively. Investments in Leases The following table details the components of our income from sales-type leases and lease financing receivables:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
(In thousands) | 2025 |  | 2024 |  | 2025 |  | 2024
Income from sales-type leases – fixed rent | $ | 503,040 |  |  | $ | 494,641 |  |  | $ | 1,505,431 |  |  | $ | 1,467,825 |
Income from sales-type leases – contingent rent (1) | 28,725 |  |  | 24,050 |  |  | 85,286 |  |  | 75,927 |
Income from lease financing receivables – fixed rent | 385,112 |  |  | 379,657 |  |  | 1,150,865 |  |  | 1,135,643 |
Income from lease financing receivables – contingent rent (1) | 1,898 |  |  | 3,211 |  |  | 5,693 |  |  | 9,634 |
Total lease revenue | 918,775 |  |  | 901,559 |  |  | 2,747,275 |  |  | 2,689,029 |
Non-cash adjustment (2) | (131,247) |  |  | (135,944) |  |  | (393,370) |  |  | (402,989) |
Total contractual lease revenue | $ | 787,528 |  |  | $ | 765,615 |  |  | $ | 2,353,905 |  |  | $ | 2,286,040 |
____________________ (1) At lease inception (or upon modification), we determine the minimum lease payments under ASC 842, which exclude amounts determined to be contingent rent. Contingent rent is generally amounts in excess of specified floors or the variable rent portion of our leases. The minimum lease payments are recognized on an effective interest basis at a constant rate of return over the life of the lease and the contingent rent portion of the lease payments are recognized as earned, both in accordance with ASC 842. (2) Amounts represent the non-cash adjustment to the minimum lease payments from sales-type leases and lease financing receivables in order to recognize income on an effective interest basis at a constant rate of return over the term of the leases. At September 30, 2025, minimum lease payments owed to us for each of the five succeeding years and thereafter under sales-type leases and our leases accounted for as financing receivables, are as follows:
|  | Minimum Lease Payments (1) (2)
|  | Investments in Leases |  |
(In thousands) |  | Sales-Type |  |  |  | Financing Receivables |  | Total
2025 (remaining) |  | $ | 444,225 |  |  |  |  | $ | 315,466 |  |  | $ | 759,691 |
2026 |  | 1,794,488 |  |  |  |  | 1,278,182 |  |  | 3,072,670 |
2027 |  | 1,821,969 |  |  |  |  | 1,302,016 |  |  | 3,123,985 |
2028 |  | 1,850,663 |  |  |  |  | 1,326,567 |  |  | 3,177,230 |
2029 |  | 1,880,313 |  |  |  |  | 1,351,597 |  |  | 3,231,910 |
Thereafter |  | 79,935,052 |  |  |  |  | 88,439,519 |  |  | 168,374,571 |
Total |  | $ | 87,726,710 |  |  |  |  | $ | 94,013,347 |  |  | $ | 181,740,057 |
____________________ (1) Minimum lease payments do not include contingent rent, as discussed above, that may be received under the lease agreements. (2) The minimum lease payments include the non-cancelable lease term and any tenant renewal options that we determined were reasonably assured, consistent with our conclusions under ASC 842 and ASC 310. Lease Provisions As of September 30, 2025, we owned 93 assets leased under 18 separate lease agreements with our tenants, certain of which are master lease agreements governing multiple properties and certain of which are for single assets. Our lease agreements are generally long-term in nature with initial terms ranging from 15 to 32 years and are structured with several tenant renewal options extending the term of the lease for another 5 to 30 years. As of September 30, 2025, our lease agreements had a weighted average lease term based on contractual rent, including extension options, of approximately 40.0 years. All of our lease agreements provide for annual base rent escalations, which may be fixed or variable over the life of the lease. The rent escalation provisions range from providing for a flat annual increase of 1% to 2% to an annual increase of 1% in the earlier years and the greater of 2% or CPI in later years, which may be subject to a maximum CPI-based cap with respect to each annual rent increase. Additionally, certain of our lease agreements provide for a variable rent component in which a portion of the annual rent, generally ranging from 20% to 30%, is subject to adjustment based on the revenues of the underlying asset in specified periods. The following is a summary of the material lease provisions of our leases with Caesars and MGM, our two most significant tenants (each, as may be amended from time to time, and each individually, as defined in the respective header):
($ In thousands) |  | MGM Master Lease |  | Caesars Regional Master Lease and Joliet Lease |  | Caesars Las Vegas Master Lease |  |  |  | MGM Grand/ Mandalay Bay Lease
Lease Provision |  |  |  |
Initial term |  | 25 years |  | 18 years |  | 18 years |  |  |  | 30 years
Initial term maturity |  | 4/30/2047 |  | 7/31/2035 |  | 7/31/2035 |  |  |  | 2/28/2050
Renewal terms |  | Three, ten-year terms |  | Four, five-year terms |  | Four, five-year terms |  |  |  | Two, ten-year terms
Current lease year |  | 5/1/25 - 4/30/26 (Lease Year 4) |  | 11/1/24 - 10/31/25 (Lease Year 8) |  | 11/1/24 - 10/31/25 (Lease Year 8) |  |  |  | 3/1/25 - 2/28/26 (Lease Year 6)
Current annual rent |  | $774,682 |  | $725,489 (1) |  | $495,418 |  |  |  | $322,392
Annual escalator (2) |  | Lease years 2-10 - 2% Lease years 11-end of term - > 2% / change in CPI (capped at 3%) |  | > 2% / change in CPI |  | > 2% / change in CPI |  |  |  | Lease years 2-15 - 2% Lease years 16-end of term – >2% / change in CPI (capped at 3%)
Variable rent adjustment (3) |  | None |  | Years 11 & 16: 80% base rent / 20% variable rent |  | Years 11 & 16: 80% base rent / 20% variable rent |  |  |  | None
Variable rent adjustment calculation |  | None |  | 4% of revenue increase/decrease: Year 11: Avg. of years 8-10 less avg. of years 5-7 Year 16: Avg. of years 13-15 less avg. of years 8-10 |  | 4% of revenue increase/decrease: Year 11: Avg. of years 8-10 less avg. of years 5-7 Year 16: Avg. of years 13-15 less avg. of years 8-10 |  |  |  | None
____________________ (1) Current annual rent with respect to the Joliet Lease is presented prior to accounting for the non-controlling interest, or rent payable, to the 20% third-party ownership of Harrah’s Joliet LandCo LLC. After adjusting for the 20% non-controlling interest, combined current annual rent under the Caesars Regional Master Lease and Joliet Lease is $716.0 million. (2) Any amounts representing rents in excess of the CPI floors specified above are considered contingent rent in accordance with GAAP. (3) Variable rent is not subject to the annual escalator. Capital Expenditure Requirements We manage our residual asset risk through protective covenants in our lease agreements, which require the tenant to, among other things, hold specific insurance coverage, engage in ongoing maintenance of the property and invest in capital improvements. With respect to the capital improvements, the lease agreements specify certain minimum amounts that our tenants must spend on capital expenditures that constitute installation, restoration and repair or other improvements of items with respect to the leased properties. The following table summarizes the capital expenditure requirements of our tenants under their respective lease agreements:
Provision |  | Caesars Regional Master Lease and Joliet Lease |  | Caesars Las Vegas Master Lease |  | MGM Grand/ Mandalay Bay Lease |  |  |  | Venetian Lease | All Other Gaming Leases (1)
Yearly minimum expenditure |  | 1% of net revenues (2) |  | 1% of net revenues (2) |  | 3.5% of net revenues based on 5-year rolling test, 1.5% monthly reserves |  |  |  | 2% of net revenues based on rolling three-year basis | 1% of net revenues
Rolling three-year minimum |  | $286 million (3) |  | $84 million (3) |  | N/A |  |  |  | N/A | N/A
____________________ (1) Represents the tenants under our other gaming lease agreements not specifically outlined in the table, as specified in the respective lease agreements. (2) The leases with Caesars require a $107.5 million floor on annual capital expenditures for Caesars Palace Las Vegas, Harrah’s Joliet and the Caesars Regional Master Lease properties in the aggregate. Additionally, annual building & improvement capital improvements must be equal to or greater than 1% of prior year net revenues. (3) Certain tenants under our leases with Caesars, as applicable, are required to spend $380.3 million on capital expenditures (excluding gaming equipment) over a rolling three-year period, with $286.0 million allocated to the regional assets, $84.0 million allocated to Caesars Palace Las Vegas and the remaining balance of $10.3 million to facilities (other than the Harrah’s Las Vegas Facility) covered by any Caesars lease in such proportion as such tenants may elect. Additionally, the tenants under the Caesars Regional Master Lease and Joliet Lease are required to spend a minimum of $531.9 million on capital expenditures (including gaming equipment) across certain of its affiliates and other assets, together with the $380.3 million requirement. Investments in Loans and Securities The following is a summary of our investments in loans and securities as of September 30, 2025 and December 31, 2024:
|  | ($ In thousands) |  | September 30, 2025
|  | Investment Type |  | Principal Balance |  | Carrying Value (1) |  | Future Funding Commitments (2) |  | Weighted Average Interest Rate (3) |  | Weighted Average Term (4)
|  | Senior Secured Notes (5) |  | $ | 83,938 |  |  | $ | 81,359 |  |  | $ | — |  |  | 11.0 | % |  | 5.5 years
|  | Senior Secured Loans |  | 992,675 |  |  | 973,550 |  |  | 503,103 |  |  | 8.2 | % |  | 4.6 years
|  | Mezzanine Loans and Preferred Equity |  | 1,394,592 |  |  | 1,378,090 |  |  | 227,450 |  |  | 9.9 | % |  | 2.7 years
|  | Total |  | $ | 2,471,205 |  |  | $ | 2,432,999 |  |  | $ | 730,553 |  |  | 9.2 | % |  | 3.6 years
|  | ($ In thousands) |  | December 31, 2024
|  | Investment Type |  | Principal Balance |  | Carrying Value (1) |  | Future Funding Commitments (2) |  | Weighted Average Interest Rate (3) |  | Weighted Average Term (4)
|  | Senior Secured Notes (5) |  | $ | 85,000 |  |  | $ | 81,857 |  |  | $ | — |  |  | 11.0 | % |  | 6.3 years
|  | Senior Secured Loans |  | 684,686 |  |  | 674,200 |  |  | 308,776 |  |  | 8.0 | % |  | 4.7 years
|  | Mezzanine Loans and Preferred Equity |  | 908,461 |  |  | 895,476 |  |  | 239,748 |  |  | 9.2 | % |  | 4.1 years
|  | Total |  | $ | 1,678,147 |  |  | $ | 1,651,533 |  |  | $ | 548,524 |  |  | 8.8 | % |  | 4.4 years
____________________ (1) Carrying value includes unamortized loan origination costs and are net of allowance for credit losses. (2) Our future funding commitments are subject to our borrowers’ compliance with the financial covenants and other applicable provisions of each respective loan agreement. (3) The weighted average interest rate is based on current outstanding principal balance and SOFR, as applicable for floating rate loans, as of September 30, 2025 and December 31, 2024. (4) Assumes all extension options are exercised; however, our loans may be repaid, subject to certain conditions, prior to such date. (5) Represents our investment in the Hard Rock Ottawa Notes, which are accounted for as held-to-maturity securities. The following summarizes the activity of our investments in loans and securities for the nine months ended September 30, 2025 and 2024:
| Nine Months Ended September 30,
(In thousands) | 2025 |  | 2024
Beginning Balance January 1, | $ | 1,651,533 |  |  | $ | 1,144,177 |
Principal fundings | 783,604 |  |  | 473,198 |
Payment-in-kind interest | 23,831 |  |  | — |
Repayments | (15,897) |  |  | (79,500) |
Change in CECL allowance | (14,045) |  |  | 8,019 |
Other | 3,973 |  |  | 4,786 |
Ending Balance September 30, | $ | 2,432,999 |  |  | $ | 1,550,680 |

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- Definition The entire disclosure for certain real estate investment financial statements, real estate investment trust operating support agreements, real estate owned, retail land sales, time share transactions, as well as other real estate related disclosures. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 974 -SubTopic 720 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org/1943274/2147477728/974-720-50-1 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 976 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/976/tableOfContent Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 978 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/978/tableOfContent Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 970 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/970/tableOfContent Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 972 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/972/tableOfContent Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 974 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/974/tableOfContent + Details
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